LEARNER
GUIDE
Participant name: _____________________________
LEGAL REQUIREMENTS AND CONTRACTS
CPCCBC4009B – Apply legal requirements to building and construction projects
CPCCBC4003A – Select and prepare a construction contract
LEGAL REQUIRMENTS AND CONTRACTS
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DISCLAIMER
This Learner Guide has been developed to assist Participants in meeting the requirements of the relevant topic
and units of competency noted in this Learner Guide.
Although the information presented in the Guide is accurate to the best of their knowledge, the authors
cannot guarantee that every statement is without flaw of any kind.
Therefore, Builders Academy Australia disclaim all liability for any errors, or for any loss or other consequences
resulting from any individual relying on, or acting upon any information in this Learner Guide.
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and reference list.
ABOUT THIS LEARNER GUIDE
This Learner Guide is designed to support the development of knowledge and skills required for the unit(s)
outlined in the topic information section below. Your trainer or workplace supervisor may also provide further
resources to assist your learning in this topic.
The Learner Guide consists of two parts:
Topic Information provides details of the unit(s) of competency covered, setting out information relating
to the aims of the unit are and what areas are covered, how the course is delivered, how the learning
activities are completed and how assessment is conducted.
Sections of the Learner Guide then outline the learning areas and activities to be covered. The information
you obtain from these activities will assist you to develop a thorough understanding of the topic, to be
able to apply this to ‘real world’ activities and prepare you to complete any assessment requirements
associated with the unit(s) of competency.
FEEDBACK
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have any feedback regarding this Assessment Booklet, please pass this on to your Trainer/Assessor, workplace
supervisor or email directly to [email protected].
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CONTENTS
CONTENTS ............................................................................................................................................... 3
COURSE INFORMATION .......................................................................................................................... 6
TOPIC INTRODUCTION .......................................................................................................................... 10
CPCCBC4009B - Apply legal requirements to building and construction projects ............................... 10
SECTION 1: LICENSING AND REGISTRATION ......................................................................................... 11
1.1 HOW TO GET A BUILDER’S LICENSE OR REGISTRATION ............................................................. 11
1.2 IN VICTORIA ................................................................................................................................. 11
1.3 IN NEW SOUTH WALES ............................................................................................................... 13
1.4 IN QUEENSLAND ......................................................................................................................... 16
Learning Activity 1.1 – Using the Victorian Building Authority Website .......................................... 21
SECTION 2: BUSINESS REGISTRATION REQUIREMENTS ........................................................................ 22
2.1 TYPES OF BUSINESSES ................................................................................................................. 22
2.2 AUSTRALIAN BUSINESS NUMBER (ABN) ..................................................................................... 26
Learning Activity 2.1 – Using the ATO to Decide Business Structure ............................................... 28
Learning Activity 2.2 – Email Your Accountant ................................................................................. 29
SECTION 3: INSURANCE REQUIRMENTS ............................................................................................... 30
3.1 IN VICTORIA ................................................................................................................................. 30
3.2 IN NEW SOUTH WALES ............................................................................................................... 31
3.3 IN QUEENSLAND ......................................................................................................................... 32
Learning Activity 3.1 – Meeting insurance needs within the building sector ................................... 34
SECTION 4: OHS/WHS REQUIREMENTS ................................................................................................ 35
4.1 WHS AND OHS: WHAT’S THE DIFFERENCE? ................................................................................ 35
4.2 WHO IS RESPONSIBLE FOR A SAFE WORKPLACE?....................................................................... 38
4.3 DUTY OF CARE ............................................................................................................................. 38
4.4 EVIDENCE OF TRAINING .............................................................................................................. 39
4.5 RISK ............................................................................................................................................. 40
4.6 LICENCE TO PERFORM HIGH RISK WORK .................................................................................... 42
4.7 BUILDING SAFETY SIGNS ............................................................................................................. 43
4.8 APPLYING SAFETY KNOWLEDGE ................................................................................................. 44
Learning Activity 4.1 – Research Legislation ..................................................................................... 46
SECTION 5: ACTS, STANDARDS, REGULATIONS AND CODES ................................................................ 47
5.1 STATE OVERVIEW ........................................................................................................................ 47
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5.2 NATIONAL CONSTRUCTION CODE (NCC) .................................................................................... 48
5.3 THE BUILDING CODE OF AUSTRALIA ........................................................................................... 49
5.4 WHAT IS A STANDARD? .............................................................................................................. 54
5.5 COMMON STANDARDS ............................................................................................................... 56
Learning Activity 5.1 – Research Standards in the Building Industry I.............................................. 58
Learning Activity 5.2 – Research Standards in the Building Industry II ............................................ 58
Learning Activity 5.3 – Research Standards in the Building Industry III ........................................... 59
Learning Activity 5.4 – Building Code Australia ................................................................................ 60
Learning Activity 5.5 – Penalties ....................................................................................................... 61
SECTION 6: PLANNING AND SUSTAINABILITY ....................................................................................... 62
6.1 IN VICTORIA ................................................................................................................................. 62
6.2 IN NEW SOUTH WALES ............................................................................................................... 64
6.3 IN QUEENSLAND ......................................................................................................................... 66
6.4 GREEN STAR ................................................................................................................................ 68
Learning Activity 6.1 – 6 Star Rating ................................................................................................. 70
Learning Activity 6.2 – Planning and Sustainability .......................................................................... 70
Learning Activity 6.3 – Council Approval .......................................................................................... 71
SECTION 7: CONTRACT LAW AND COMMON LAW PRINCIPLES............................................................ 72
7.1 IN VICTORIA ................................................................................................................................. 72
7.2 IN NEW SOUTH WALES ............................................................................................................... 73
7.3 IN QUEENSLAND ......................................................................................................................... 73
7.4 COPYRIGHT .................................................................................................................................. 74
Learning Activity 7.1 – Contract Law I ............................................................................................... 75
Learning Activity 7.2 – Contract Law II .............................................................................................. 76
SECTION 8: FINANCIAL TRANSACTIONS ................................................................................................ 77
8.1 PAYSLIP RECORDS ....................................................................................................................... 77
8.2 PAYROLL REQUIREMENTS ........................................................................................................... 77
8.3 SUPERANNUATION (‘SUPER’) CONTRIBUTIONS.......................................................................... 78
8.4 GOODS AND SERVICES TAX (GST) ............................................................................................... 78
8.5 WHAT IS A TAX INVOICE? ............................................................................................................ 79
8.6 MANAGING YOUR PAPERWORK ................................................................................................. 80
Learning Activity 8.1 – Calculating GST ............................................................................................. 82
Learning Activity 8.2 – Superannuation ............................................................................................ 82
SECTION 9: CONTRACTS ........................................................................................................................ 83
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9.1 WHAT IS A CONTRACT? ............................................................................................................... 83
9.2 UNDERSTANDING LEGAL RESPONSIBILITIES ............................................................................... 86
9.3 TYPES OF CONSTRUCTION CONTRACTS ...................................................................................... 90
9.4 STANDARD FORM CONTRACTS ................................................................................................... 94
9.5 RIGHTS AND LIABILITIES OF PARTIES .......................................................................................... 99
9.6 BREACHES AND TERMINATION ................................................................................................. 102
9.7 LEGISLATIVE CONDITIONS ......................................................................................................... 104
Learning Activity 9.1 – Building Contracts ...................................................................................... 110
Learning Activity 9.2 – New Home Contract ................................................................................... 111
Learning Activity 9.3 – Variation to Plans ....................................................................................... 112
SECTION 10: CONTRACT SELECTION ................................................................................................... 113
10.1 SELECT AN APPROPRIATE CONTRACT ..................................................................................... 113
10.2 IDENTIFY CONTRACT DOCUMENTATION ................................................................................ 113
10.3 SELECT SUBCONTRACTORS ..................................................................................................... 115
10.4 FORM A BINDING AGREEMENT .............................................................................................. 116
Learning Activity 10.1 – Contract Selection .................................................................................... 119
Learning Activity 10.2 – General Conditions of Contract ................................................................ 119
SECTION 11: CONTRACT ADMINISTRATION ........................................................................................ 120
11.1 PREPARE THE CONTRACT ........................................................................................................ 120
11.2 SEEK EXPERT ADVICE ............................................................................................................... 123
11.3 PROJECT REPORTING .............................................................................................................. 123
11.4 PRACTICAL COMPLETION ........................................................................................................ 124
11.5 TERMINATION ......................................................................................................................... 127
11.6 CALCULATON OF RISE AND FALL PROVISIONS ........................................................................ 128
11.7 PROGRESS PAYMENTS ............................................................................................................ 130
11.8 EXTENSIONS OF TIME.............................................................................................................. 133
11.9 FINALISE THE CONTRACT ........................................................................................................ 134
11.10 CLOSE AND STORE THE JOB FILE ........................................................................................... 136
11.11 PRACTICAL COMPLETION INSPECTION ................................................................................. 136
Learning Activity 11.1 – Understanding Contractual Terms ........................................................... 139
Learning Activity 11.2 – Finalising the Contract.............................................................................. 140
SECTION 12: INDUSTRIAL RELATIONS, POLICIES AND OBLIGATIONS ................................................. 141
12.1 EMPLOYER OBLIGATIONS ....................................................................................................... 141
12.2 NATIONAL EMPLOYMENT STANDARDS (NES) ......................................................................... 141
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12.3 ENTERPRISE BARGAINING ....................................................................................................... 143
12.4 UNION RIGHT OF ENTRY ......................................................................................................... 143
12.5 BUILDING AND CONSTRUCTION AWARDS .............................................................................. 144
12.6 INDEPENDENT CONTRACTORS ................................................................................................ 145
12.7 MODERN AWARDS .................................................................................................................. 147
12.8 WORKPLACE DISCRIMINATION ............................................................................................... 149
12.9 TRAINING AGREEMENTS (BY STATE) ....................................................................................... 152
12.10 COMPLAINTS AND DISPUTES ................................................................................................ 154
Learning Activity 12.1 – Working with Subcontractors .................................................................. 156
Learning Activity 12.2 – Collecting Subcontractor Information ...................................................... 157
SUMMARY ........................................................................................................................................... 158
APPENDIX A: ACRONYMS .................................................................................................................... 159
APPENDIX B: ACTS, LEGISLATION AND REGULATORS ......................................................................... 160
APPENDIX C: REFERENCES AND RESOURCES ...................................................................................... 164
COURSE INFORMATION
This Learner Guide covers the following unit/s of competency:
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CPCCBC4009B – Apply legal requirements to building and construction projects
CPCCBC4003A – Select and prepare a construction contract
Who is this Learner
Guide designed for?
This guide supports the needs of builders, site managers, forepersons, estimators
and other construction industry personnel responsible for:
Applying legal requirements to residential and low rise commercial
building and construction projects
Selecting and preparing contracts for building work
What are the aims of
the learning topics?
The key outcomes are:
Apply legal requirements to building and construction projects:
Apply the laws relating to builder licensing or registration
Apply ohs legislation and provisions on site
Apply the codes, acts, regulations and standards relevant to
construction
Comply with insurance and regulatory requirements for housing
construction
Apply legislation to financial transactions
Meet building contract obligations
Apply industrial relations policies and obligations relevant to housing
construction
Apply dispute resolution processes
Select and prepare a construction contract:
Identify and analyse the essential elements, sections and clauses of a
business contract
Select an appropriate contract for the works to be undertaken
Prepare the contract
Prerequisites &
co-requisites
N/a
Licensing requirements With regards to CPCCBC4009B Apply legal requirements to building and
construction projects:
Application of legal requirements includes the capacity to ensure compliance
with all contractual requirements. A thorough knowledge of the application of
current legal and regulatory requirements is essential.
Specific resource
requirements
You will require access to the following resources as you undertake study in this
unit:
Various types of construction industry contracts
Relevant codes, standards and government regulations
Office equipment, including calculators, photocopiers and telephone
systems
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Computers with appropriate software to view 2-d cad drawings, contracts,
run costing programs and print copies
A technical reference library with current publications on measurement,
design, building construction and manufacturers’ product literature
A suitable work area appropriate to the construction process
Learning activities The learning activities in this learner guide have been designed to assist you to
develop the skills that are necessary to demonstrate consistent achievement of
the workplace outcomes covered by each of the unit(s) of competency.
They are also designed to allow you to work through the activities in a workshop
situation, with a small group or individually at your own pace. If you need
assistance please talk to your trainer or your workplace supervisor who will assist
you.
Further resources Along with this learner guide you will need to find information from various
sources. You may find copies of relevant legislation, codes, standards etc. On the
internet, from your trainer or you may already subscribe to the Australian
Standards or Building Codes Board.
Websites can be another source of relevant information. Further website links,
reference material and recommended reading will be noted throughout this
Learner Guide under each topic.
Further resources of particular interest for this topic are:
Australian Standard (as 4120 – 1994) Code of Tendering. Sets out the ethics
and obligations of the principal and tenderers in the tendering process in the
construction industry.
Competition and Consumer Act 2010 (formerly the Trade Practices Act 1974)
Building Code 2013, Fair Work Building and Construction, available from
http://www.fwbc.gov.au/what-building-code
Victorian Code of Practice for the Building and Construction Industry
(Victorian code) and the Implementation Guidelines to the Victorian Code of
Practice for the Building and Construction Industry, April 2012 (Victorian
Guidelines) can be downloaded from www.dtf.vic.gov.au/
New South Wales code of practice for procurement (NSW code) and the
Implementation Guidelines to the New South Wales Code of Practice for
Procurement: Building and Construction, July 2013 (NSW guidelines) can be
downloaded from www.industrialrelations.nsw.gov.au.
Queensland Procurement Policy, 2013. Related guidelines, guidance,
templates and other resources can be found at www.hpw.qld.gov.au.
Australian Standard Method of Measurement of Building Works, 5th edition,
Australian Institute of Quantity Surveyors, 2000
Guidelines for Tendering, Australian Contractors Association, 2006
Guide to Tendering with Western Australian Public Authorities, 9th ed.
Department of Finance, WA 2014
What are the
assessment
arrangements?
Assessment requirements for the unit(s) of competency related to this Learner
Guide are covered in the relevant assessment booklet for this topic. Please refer
to the assessment booklet for further information. Further information may also
be available from your trainer or workplace supervisor.
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TOPIC INTRODUCTION
CPCCBC4009B - Apply legal requirements to building and construction
projects
In the following sections you will cover the legal requirements that apply to building and construction projects
of residential and low rise commercial buildings, including insurance requirements, financial requirements,
industrial relations policies and an introduction to dispute resolution processes.
It will also include a comprehensive study of selecting and preparing different types of construction contracts.
Australian law
Australian law is a very complex and dynamic topic to study. In this Learner Guide, we have broken the topic
into several sections and sub-sections, based on the three units of competency this topic relates to (see What
are the aims of the learning topics? on the previous page).
In essence, construction law is made up of an amalgamation of contract law, commercial, law, planning law,
employment law and tort. It is critical that you have a solid understanding of these areas to ensure you are
meeting all of your legal obligations as a member of the building and construction industry.
What is the law?
Australian Law is based on the English Legal system of Law of Precedence: where judgments made in legal
cases become the foundation for legal decisions made in subsequent cases. The decisions then become legal
principles.
Sometimes these judgements can be seen as so significant by the legal system that they are referenced in
future legal cases as landmark cases.
Components of the legal system
The legal system can be broadly categorized into two components:
Common Law: all principles applied in common law have their roots in judgments made consistently over
time
Statute Law: is legislation* that has been passed through Parliament
*Statute law includes:
Legislation – the law made by parliament which sets out
rules on a particular subject
Delegated – regulations and by-laws – the fine detail of
legislation
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SECTION 1: LICENSING AND REGISTRATION
In this section we will learn about the requirements for gaining construction license and registrations, with a
state-by-state focus on specific requirements and governing bodies involved.
1.1 HOW TO GET A BUILDER’S LICENSE OR REGISTRATION
To work as a builder or tradesperson in Australia you must have a licence or be registered (requirements vary
depending on your state or territory). A licence or registration may require a combination of technical
qualification, experience, skills and knowledge prior to application. One step in the process of gaining your
licence or registration is to complete training which has been approved by the licensing body in your state. In
some states you may also need to participate in ongoing training workshops to maintain your licence or
registration.
Legislation and law differs depending upon what Australian state you
live in, so ensure you research and abide by the laws relevant to your
location and place of business. Refer to “Appendix B Acts and
Regulators” for a list of different State regulations and further
reference material organised by State. This resource contains
information about legal requirements for construction projects in
Victoria, New South Wales and Queensland.
1.2 IN VICTORIA
The Building Practitioners Board (BPB) is an independent statutory body established under the Building Act
1993.It is part of the Victorian Building Authority. It oversees the quality and standard of professional services
in the Victorian building industry. In doing so, it administers a registration system and monitors the conduct and
ability of registered building practitioners.
The Building Act 1993 requires most people who work in
building to be registered as building practitioners with the BPB.
Building Regulations 2006 outline the various categories and
classes of building practitioners. Registration is based upon the
nature and extent of your qualifications and experience as set
out in the Building Act 1993 and Building Regulations 2006. You
must be registered with the Building Practitioners Board in
Victoria to:
Perform domestic building work where the cost exceeds
$5,000 (including labour and materials)
Carry out re-blocking, re-stumping, demolishing, removing a home, or any building work that requires a
permit, regardless of cost
Provide more than one type of building work, such as plastering and painting, where the cost exceeds $5,000
(including labour and materials).
If you carry out domestic building work for an employer who is a corporate entity, then one of the directors of
that entity must be registered. Your application for registration must be processed and confirmed by the Building
Practitioners Board before you start work – it is not enough for you to have simply submitted an application for
registration.
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If you are not registered, it is an offence to enter into a contract to perform work that requires a registered
building practitioner, and to carry out that work. All registration applications to the Building Practitioners Board
must include a signed authorisation by the applicant for the conduct of a National Police Certificate Check. All
forms must be accompanied by 100 points of certified
identification. Scanned or copied signatures of the certifier
will not be accepted.
To view the different categories of registration and
application forms for Victoria, please visit the Victorian
Building Authority website (vba.vic.gov.au).
To register, you must have the required qualifications,
knowledge and expertise to perform your job competently
and safely. You need to have Domestic Building Insurance
(formerly Builders Warranty Insurance). The Board registers individual builders, not businesses and companies.
Building practitioners include:
Building surveyors
Building inspectors (unlimited/limited)
Quantity surveyors
Engineers (civil/mechanical/electrical/fire safety)
Draftspersons (building design - architectural, interior, services)
Commercial builders (unlimited/limited)
Domestic builders (unlimited/limited/manager)
Demolishers (low-rise buildings/medium-rise buildings/unlimited)
Erector or supervisor (temporary structures - class 1 and 2).
Domestic builder registration classes
Some categories in the building profession (such as electricians and plumbers), must register with other industry
organisations instead of the Building Practitioners’ Board. There are 3 classes of Domestic Builder Registration,
listed below with the responsibilities of the holder:
1. Domestic Builder Unlimited (DB-U) - May personally carry out, manage, or arrange for sub-contractors
to carry out, all components of domestic building work.
2. Domestic Builder Manager (DB-M) - May manage, or arrange for domestic builders registered in
another class, to carry out components of domestic work specified in their Certificate of Registration.
3. Domestic Builder-Limited (DB-L) - May carry out, manage, or arrange to carry out only the components
of domestic building work specified in their Certificate of Registration.
In addition, practitioners registered as a DB-M:
must hire registered practitioners to undertake work
cannot carry out work unsupervised
can only carry out work if they are supervised by a practitioner registered in the work they are
undertaking – for example, a DB-M cannot perform carpentry work on-site unless they are supervised
by a practitioner holding the registration of Domestic Builder – Carpentry (DB-L C) or they are a DB-U.
While practitioners holding a DB-U or a DB-M must recognise an issue as it arises on site (such as defective work
or non-compliance with the standards), the DB-U registration enables the practitioner to personally rectify it, if
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it is covered under their scope of work. The practitioner holding a DB-M registration must identify the correct
registered person to rectify the issue for them. Should a DB-M be audited or inspected, they may need to provide
a list of the registered practitioners employed to cover the appropriate work.
1.3 IN NEW SOUTH WALES
NSW Fair Trading safeguards the rights of all consumers and
advises business and traders on fair and ethical practice.
They provide services directly to individuals and businesses
to create a fair, safe and equitable marketplace. The laws
they administer set the rules for fairness in daily transactions
between consumers and traders. They investigate unfair
practices and ensure that the products sold in NSW are safe
and meet their regulations and safety standards. They
register co-operatives and associations, and issue
occupational licences so consumers can trust the people they
are dealing with.
If you are involved in the residential building industry then
you should be registered with NSW Fair Trading. The Building Amendment Act 2014 requires most people who
work in residential building to be registered as building practitioners with NSW Fair Trading. This Act replaces
the Home Building Act 1989 and was implemented in two stages, January 2015 and March 2015. The Home
Building Amendment Act 2014 outlines the various categories and classes of building practitioners, contractors,
supervisors and tradespersons. Registration is based upon the nature and extent of your qualifications and
experience as set out in the Home Building Amendment Act 2014.
You must be registered with NSW Fair Trading to contract, sub-contract or advertise to do:
building work where the reasonable market cost exceeds of the labour and materials is more than
$5,000
all electrical wiring work
all plumbing, draining and gas fitting work
all air conditioning and refrigeration work (except plug-in appliances)
‘Residential building work’ is defined as coordinating or suspending any work in the construction of a 'dwelling'
(as defined in the Regulation), the making of alterations or additions to a dwelling, and repairing, renovation,
decoration or the protective treatment of a dwelling. It also includes specialist work done in connection with a
dwelling. Specialist work includes plumbing work (other than roof plumbing work), gas fitting work, electrical
wiring work, and installation or maintenance of certain refrigeration systems and air-conditioning systems. It is
not restricted to such work being done in a residential context.
Any work that is residential building work under the Home Building Amendment Act 2014 which involves
construction of a dwelling, or alterations or additions to a dwelling. It also includes repairing, renovating,
decorating or applying protective treatment to a dwelling. For licensing purposes, works considered to fall within
the class of building work that include, but are not necessarily limited to:
garage, carport and shed construction/erection (including kits)
bathroom, kitchen or laundry renovations
swimming pool building and structural landscaping
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screened, glass or pool enclosures
atriums, conservatories
house lifting (e.g. permanently raising the height of an existing structure)
removal and resitting of dwellings
saunas and steam rooms
Any contract for general building work can include any specialist work that is integral to the overall work, but
such work must be carried out by the holder of an endorsed contractor licence or qualified supervisor certificate
in the relevant category of specialist work.
Builder's licensing requirements
Who requires a licence?
Individuals, partnerships or corporations contracting to do residential building work, where the labour and
materials are worth more than $1,000, or specialist work (irrespective of whether it is residential building work),
must hold a contractor licence under the HBA Act. Individuals must hold a contractor licence or must be an
employee of a partnership or corporation or a partner or officer of a partnership or corporation that holds a
contractor licence.
Where an individual is the employee, partner or officer of a partnership or corporation that holds a contractor
licence, and is not the holder of a licence in his or her own capacity, then the individual must be supervised by
someone who is licensed.
What criteria apply to the grant of a license?
The applicant's fitness, ability and capacity to carry out contracts for which the licence is required; and the
arrangements made or proposed to ensure that all work done under those contracts will be done or supervised
by appropriately qualified individuals.
Who needs to be supervised?
Individuals who are not licensed and are carrying out residential building work and specialist work need to be
supervised. Individuals holding relevant tradesperson certificates can carry out residential building work,
refrigeration work or air-conditioning work without supervision but must be supervised when carrying out
plumbing work, gas fitting work or electrical wiring work.
What is an appropriate level of supervision?
The HBA Act does not contain a definition of 'supervision'. Compliance with the supervision requirements of the
HBA Act is to be determined on the facts of each case. However, the level of supervision must be sufficient so
as to ensure that the requirements applicable to the work under the HBA Act are complied with. To view the
different categories of registration and application forms for New South Wales, visit the NSW Fair Trading
website. To register, you must have the required qualifications, knowledge and expertise to perform your job
competently and safely. You need to have insurance provided by the Self-Insurance Corporation in place if the
contract for residential building work is valued at over $20,000.
Types of Licences and Certificates
The following licenses and certificates are required under the Home Building Amendment Act 2014:
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Contractor Licence authorises that holder to contract and advertise to carry out the work described on their
licence card. Individuals may have their contractor licence endorsed with a Q and this indicates that the licence
is also equivalent to a Qualified Supervisor Certificate. As an endorsed contractor licence holder is qualified they
do not require a nominated supervisor.
Qualified Supervisor Certificate allows the holder to supervise and carry out the work as described on their
certificate.
Nominated Qualified Supervisor is an individual who holds an endorsed contractor licence or a qualified
supervisor certificate, and who is registered against a contractor licence as the person supervising the residential
building work or specialist work. All companies and partnerships and unqualified individuals holding a contractor
licence must nominate a supervisor.
Tradesperson Certificate is only issued in the classes of plumbing, draining and gas fitting and allows a person
to undertake work with minimum supervision. Any work undertaken by the holder of a tradesperson certificate
cannot sign off on work and work must be signed off by the holder of a contractor licence or qualified supervisor
certificate. Tradesperson certificates used to be known as a ‘journeyman’.
Approved Qualifications and Experience
For general building work, the current qualifications requirements, outlined below, commenced on 5 January
2015. Applicants must show at least 2 years relevant industry experience in a wide range of building construction
work where the majority of the experience was obtained within 10
years of the date on which the application is made. ‘Experience’
means experience gained by the applicant as:
a) an employee of, or
b) a holder of a supervisor certificate and as a nominated
supervisor for the contractor licence held by, or
c) a holder of an endorsed contractor licence contracted to,
or
d) a holder of a supervisor certificate in the capacity of a
nominated supervisor for a contractor licence held by an
individual, partnership or corporation contracted to, the
holder of a contractor licence authorising the holder to do the class of residential building work in which
the experience was gained (“the Work”), where the applicant, during the relevant period, was:
supervised and directed in the doing of the Work by the holder of an endorsed contractor
licence or supervisor certificate authorising its holder to supervise the Work, and
remunerated with money in accordance with law for the Work which the applicant carried out
For more information on specialist building work and tradespersons go to the NSW Fair Trading website.
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1.4 IN QUEENSLAND
The Queensland Building and Construction Commission (QBCC) is the State’s building and construction industry
regulator. It is a statutory body and is part of the portfolio of the Minister for Housing and Public Works. The
QBCC was established under the Queensland Building and Construction Commission Act 1991 (QBCC Act) to
regulate the building industry. The objectives of the QBCC Act are to:
Regulate the building industry
Ensure the maintenance of proper standards in the industry
Achieve a reasonable balance between the interests of
building contractors and consumers
Provide remedies for defective building work
Provide for the efficient resolution of building disputes
Provide support, education and advice for homeowners and
those undertaking building work.
The Queensland Building and Construction Commission administers
the following legislation:
Building and Construction Industry Payments Act 2004
Building and Construction Industry Payments Regulation 2004
Domestic Building Contracts Act 2000
Domestic Building Contracts Regulation 2010
Queensland Building and Construction Commission Act 1991
Queensland Building and Construction Commission Regulation 2003
Subcontractors Charges Act 19741
Under the QBCC Act, any contractors performing building work over the value of $3,300 must hold a Queensland
Building and Construction Commission (QBCC) licence. It is important to understand and comply with the
legislation, as failure to do so will result in not only monetary fines, but the accumulation of demerit points. If a
contractor accumulates more than 30 demerit points over a three year period, they will lose their contracting
licence and not be eligible for reinstatement of the licence for another three years. There are a number of
different licence classes for the building and construction industry which are listed below with details of the
scope of work which applies to each class.
Builders Classifications
Builder – low rise
Building work on a class 1 or class 10 building
Building work on classes 2 to 9 buildings with a gross floor area not exceeding 2000m², but not including
Type A or Type B construction
Prepare plans and specifications if the plans and specifications are:
o for the licensee’s personal use, or
o for use in building work to be performed by the licensee personally
Builder – medium rise
Building work on a class 1 or class 10 building
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Building work to a maximum of 3 storeys, but not including Type A construction on classes 4 to 9
buildings
Prepare plans and specifications if the plans and specifications are:
o for the licensee’s personal use, or
o for use in building work to be performed by the licensee personally
Builder – open
Building work on all classes of buildings
Prepare plans and specifications if the plans and specifications are:
o for the licensee’s personal use, or
o for use in building work to be performed by the licensee personally
Builder – Project Management Services
Provide any of the following for a consumer or a principal, for all classes of building work:
o administration services
o advisory services
o management services, other than coordinating the scheduling of building work by building
contractors, including as agent for another person
If appointed as a superintendent* under the contract, you can perform the following functions:
o administer the contract on behalf of a principal for the contract
o certify timing, quality and cost matters under the contract
Builder – restricted
Builder Restricted to Kitchen, Bathroom and Laundry:
Install, refurbish, restore and repair a kitchen, bathroom or laundry on-site in:
class 1 or class 10 building
classes 2 to 9 buildings if the gross floor area of the kitchen, bathroom or laundry is not more than 50m²
Prepare plans and specifications if the plans and specifications are:
o for the licensee’s personal use, or
o for use in building work to be performed by the licensee personally
Builder Restricted to Shop Fitting:
Building work associated with the internal fit out of a shop or
office, including shop fronts, but not including Type A or Type B
construction
Prepare plans and specifications if the plans and specifications
are:
o for the licensee’s personal use, or
o for use in building work to be performed by the licensee
personally
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Builder Restricted to Structural Landscaping:
Prepare, fabricate and erect carports, decking, fences, gate, gazebos, ornamental structures, pergolas,
ponds and water features, prefabricated sheds including associated concrete slabs, with a maximum
floor area of 10m², and retaining walls and structures
Construct artificial landform structures requiring a fabricated internal structure
Prepare site, excavate, lay paving or concrete associated with landscaping
Install irrigation for landscaping works
Install, erect and construct playground equipment
Prepare plans and specifications if the plans and specifications are:
o for the licensee’s personal use, or
o for use in building work to be performed by the licensee personally
Builder Restricted to Swimming Pool Construction:
Earthworks and drainage for swimming pool and spa installation and construction
Place and fix reinforcement for concrete for swimming pool and spa construction
Install formwork to define a swimming pool or spa shape or form
Place and finish concrete or other materials to provide a shape or form for a swimming pool or spa,
including packing, filling and levelling of prefabricated pool and spa units
Install prefabricated swimming pools and spas
Ancillary pipework including general filtration, sanitation, water chemistry, solar heating and basic
hydraulics
Landscaping works associated with the construction of a swimming pool or spa including pool fencing
Carry out ceramic tiling, painting, paving and plastering associated with the construction of a swimming
pool or spa
Prepare plans and specifications if the plans and specifications are:
o for the licensee’s personal use, or
o for use in building work to be performed by the licensee personally
Builder Restricted to Special Structures – Shade Sails:
Construction, installation, maintenance or repair of membrane shade structures including metal
brackets, cables and structural members for the structures
Concreting work for footings for the structures, and
Prepare plans and specifications for membrane shade structures if the plans and specifications are:
o for the licensee's personal use, or
o for use in building work to be performed by the licensee personally
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Builder Restricted to Special Structures – Signs
Construction, installation, maintenance or repair of signs and
supporting structures for signs, and
Concreting work for footings for supporting structures for signs,
and
Prepare plans and specifications for signs and supporting structures
for signs if the plans and specifications are:
o for the licensee’s personal use, or
o for use in building work to be performed by the licensee personally
The Queensland Building and Construction Commission also issue licences for:
Building Design
Completed Residential Building Inspection
Trade contractor
Occupational and provisional plumbing and draining licences
Restricted plumbing and draining licences
Fire protection licences
Builder's Licensing Requirements
Who requires a licence?
In Queensland, individuals and companies must hold a QBCC licence to carry out:
Any building work valued over $3,300
Building work valued over $1,100 where it involves Hydraulic Services Design
Building work of any value where it involves:
o Drainage
o Plumbing and Drainage
o Gas Fitting
o Termite Management – Chemical
o Fire Protection
o Completed Residential Building Inspection
o Building Design – Low Rise, Medium Rise and Open
o Site Classification
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In addition to the licence classes, there are also licence grades to cover different roles and responsibilities. The
following table sets these out:
GRADE SUPERVSING BUILDING
WORK
BE A NOMINEE FOR A
BUILDING COMPANY
ENTER INTO BUILDING
CONTRACTS FOR BUILDING
WORK
Contractor Yes Yes Yes
Nominee Supervisor Yes Yes
Site Supervisor Yes
Fire Occupational Yes
Requirements for Registration
There are different qualifications, skills and experience that you must be able to prove to apply for a licence
which is applicable to your scope of work. For more details on these requirements go to the QBCC website.
To apply for a licence you will need to provide:
details of 2 to 4 years' experience where you carried out building work covered in the relevant scope
of work. This should show your coordination and onsite supervision of trade contractors and other
disciplines, and should include any supporting documents. You must include the class, size, number of
storeys and type of construction
documents showing you hold the technical qualifications required for the licence class (e.g.
apprenticeship, skills recognition, or formal qualification documents). If you don’t hold the technical
qualification refer to Recognition of Prior Learning for further information
three written references which include confirmation of your supervisory experience
financial information that shows you meet the Minimum Financial Requirements (PDF)
nominee supervisor applicants don’t need to provide financial information
applicants in Builder Project Management Services may not need to provide financial information
proof of identity (e.g. certified copy of your driver’s licence or passport)
if contracting under a trading name – a current copy of your Record of Registration from Australian
Securities and Investment Commission (ASIC)
if contracting under a partnership – proof of the business partnership, or an original or certified copy
of QBCC’s Statutory Declaration for Partnership Agreement (PDF) if you already hold a QBCC licence
The Australian Business License and Information Service (ABLIS)
The Australian Business License and Information Service (ABLIS) helps
you find the government licences, permits, approvals, registrations,
codes of practice, standards and guidelines you need to know about to
meet your compliance responsibilities. Enter the details of your
business on the website and you will get a list of all the licensing,
certification and approvals you must have. You can find this
information at h .
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Learning Activity 1.1 – Using the Victorian Building Authority Website
This Activity may be completed in pairs.
1. Explore the Victorian Building Authority Website (http://www.vba.vic.gov.au).
2. Find two pieces of documentation that pertain to licensing and registration, relevant to your work if
possible.
3. List them and provide a brief explanation of each. For example, “I need to consider ‘Building product
accreditation’ in my work as a carpenter. This is a certificate that proves the product is safe and meets
the requirements of the Building Regulations.”
4. What type of license of registration do you need, (or will you need), to practice legally in your trade?
You may use this space to take any notes:
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SECTION 2: BUSINESS REGISTRATION REQUIREMENTS
The first consideration when becoming a registered builder in Australia is to think through how you’ll need to
set your business up. It is important to choose the business structure that best meets your specific needs.
2.1 TYPES OF BUSINESSES
There are four types of business structures that you may consider:
Sole trader
Partnership
Company
Trust
We will look at the four business types in detail, and provide information about the correct business structure
to suit your experience and business type. It’s important to plan ahead and consider your business’ future when
selecting a business structure. Key steps to plan for your businesses’ future are as follows:
Write a simple business and marketing plan, including how you will advertise your services, what you
will charge, and which part of the market you wish to target
Plan your finances. Make sure your business can survive on the money you have in the bank, or from
a bank loan, together with the money generated by your business
Plan your cash flow; anticipate peaks and troughs in both cash inflows and outflows
Decide if you want to employ staff and, if so, plan for acquiring the necessary skills, training or industry
certification
Work out tax, insurance and superannuation payments; find out exactly what payments you need to
make and how you should keep business records. Work out if you will be handling GST. Get answers
from the Australian Taxation Office (ATO) website. Contact them for more details or advice if necessary
TYPE OF BUSINESS - SOLE TRADER
This is the most straightforward structure for a business. Basically it means the business decisions are being
made by one person. However, it doesn't necessarily mean that the business has only one worker. The sole
trader can employ others to do any or all of the work in the business.
What are the advantages of being a sole trader?
This type of structure is ideal if the business is not complicated, especially if it
does not require a great deal of outside capital. Benefits include:
There is not much paperwork involved in establishing this type of
structure
If you use your own name, you do not have to register the business
name (this will only be necessary if you have a trading name)
There are less stringent official reporting obligations compared with
other structures
You may be able to deduct tax losses from personal income
You are entitled to profits and the ownership of assets
It is relatively straightforward to wind up
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What are the disadvantages to being a sole trader?
You are personally liable for all debts
Your personal property and assets may be vulnerable for debts and other business liabilities
Large sums of capital are less likely to be available to a sole trader, and you may have to rely more on
overdrafts and personal savings
You may require enormous investments of time without the normal employee recreation leave and
other benefits
There may be issues of continuity of business in the event of death or illness
TYPE OF BUSINESS - PARTNERSHIPS
Partners are joint owners of a single business. They share the same business goals and are equally responsible
for the decisions made on behalf of the business.
Are all partners equal?
Not necessarily. For instance, in many law firms there are senior
and junior partners. However, the partners remain equal from a
legal point of view. If there is no written agreement, all partners:
Share profits equally
Cover losses equally
Take equal responsibility for the business's activities and
trading
A written agreement allows partners to create partnership rules
that best meet their particular situation.
Partnership agreements
A written partnership agreement is usually best because otherwise there is no record of the duties and
responsibilities of partners. A written agreement can be very important if there is a dispute between the partners
later on. Additionally, if there is no written agreement, the duties and responsibilities of partners are, by default,
shared equally and this may not be what either of the partners want. A partnership agreement may include (but
not be limited to):
The amount of money each partner brings into the partnership
How the profits will be divided
The different roles and responsibilities of each partner
The requirements to provide financial reports
The rights of partners to draw on bank accounts
How partners can leave the partnership and the consequences of this
What happens when the business is sold
How disputes are handled
The salaries
The rights of departing partners e.g. to start a similar business
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Partner's Unlawful Acts
What if the partner does something that is outside their authority under the partnership agreement? This
depends upon whether the person who dealt with the partner knew (or should have known) that the action was
beyond the partner’s authority. But even if this is so, it will sometimes still be possible for the person to claim
compensation from the partnership. The lesson is clear: be very careful who you accept into a business as a
partner.
Tax
Partners must file a Partnership return with the ATO. This includes a profit and loss statement, and the basis on
which profits or losses are distributed to the partners. The Partnership does not pay tax. Tax is paid individually
by partners on their share of the profits as part of their personal income tax.
TYPE OF BUSINESS - COMPANY
In many ways a company is similar to a sole trader or partnership, except that it exists as a separate legal entity
from the owners (who are called shareholders). This means that in
most circumstances, personal assets of the owners cannot be touched
to pay for the debts of the company.
What law applies?
A Commonwealth law called the Corporations Act covers all legal
aspects of the operations of a company. There is a "Small Business
Guide" included as part of this Act to help small business operators
understand their rights and obligations.
Regulation of Companies
Companies are regulated by the Australian Securities and Investment
Commission (ASIC). ASIC is an independent government body that
administers the Corporations Act. Its aims are to provide protection for consumers and businesses in their
dealings with companies and to ensure that companies:
Operate according to the law
Report their activities
Maintain proper records
Maintain an information database on company details
Types of companies
Most companies fall into one of two categories depending on the type of liability that can be imposed on the
owners. The categories are:
A company limited by shares - such companies limit the liability of shareholders to the value of their
shares. This structure is suitable for most trading businesses. The company can be a private company
or a public company
A company limited by guarantee - such companies are most often used by non-trading organisations
e.g. sporting clubs
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The Advantages and Disadvantages of a Company
Advantages of a company include:
It is a separate legal entity from the owners
You can own property in the name of the company
There is usually limited liability for the shareholders (unless they have given a personal guarantee)
You may be able to take advantage of tax minimisation schemes (legal ones of course!)
It can be owned and operated by only one shareholder and director
It may make it easier to attract capital investment because of shareholders' limited liability
Possible disadvantages include:
They can be complicated and expensive to establish and administer, especially if it is a large company
If you are not a sole shareholder, the shares may be difficult to sell
If you have only a minority shareholding you may be allowed little or no input into the affairs of the
company
You will only be able to leave the shares in the company to your beneficiaries under your will, not the
assets of the company separately
They require expensive procedures to comply with reporting regulations
Is liability always limited?
No. There are types of structures that do not provide limited liability for owners, but they are unusual and we
will not look at them here. However, even in companies limited by shares it is possible for owners to be exposed
to personal liability. For example:
A bank may require a personal guarantee against loans or overdrafts
A director can be held personally responsible for certain company actions e.g. for continuing to trade
and incur debts when the company is insolvent
Shareholders
Shares can either be available to the general public or restricted to the private owners. If the shares are available
to the public it is called a "public" company. If the shares are available to private owners it is called a private
(proprietary) company. We will deal solely with private companies.
Private companies
The Corporations Act has made the procedures for small private companies a lot easier than they used to be.
A private company will also have:
The words "Proprietary Limited" (Pty. Ltd.) After its name
A unique Australian Company Number (ACN) that will be included in most company literature and
business documents, e.g. Invoices, receipts, business letterhead, cheques etc.
A common seal (i.e. a stamp) which contains the company name and other identifying details, e.g. The
ACN (it is no longer compulsory to have a common seal)
A registered office, although this doesn't have to be the place of business. It is often the address of the
accountant or lawyer. However, under the law, companies are required to notify ASIC of changes in the
company's place of business where that place is different from the registered office
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TYPE OF BUSINESS - TRUST
Trusts are often used in connection with running a small business. A trust is not a separate legal entity in the
way that a company is. In simple terms it is a business structure where
a trustee (usually a company) carries out the business on behalf of the
members of the trust. A trust is set up through a trust deed.
Types of trust
There are a range of trusts:
Discretionary trusts - where the trustee has discretion when
distributing funds to the beneficiaries (the most common
example is a family trust)
Unit trust - were unit holders having a number of units in the
trust; distribution from the trust is on the basis of the number
of units held
Hybrid trust - this is a combination between a unit trust and a discretionary trust
Definitions
Appointer – The person who has power under the trust deed to remove the trustee and appoint
another trustee.
Beneficiaries – The people (or a company) who are entitled to distributions from the trust.
Settlor – A person (who is unrelated to the beneficiary or trustee) who provides an amount of money
(e.g. $10) to establish the trust.
Trustee - Usually a company (it can be a person) which owns the assets of the trust, not in its own right,
but as trustee of the trust. The trustee is responsible for the financial ‘health’ of the trust and makes
decisions about distributing income, borrowing money etc.
The Advantages and Disadvantages of Trusts
Advantages of a trust include:
There may be taxation advantages - although this depends on current tax laws
Allows for income streaming
Limited liability etc.
The disadvantages of a trust include:
Possible implication for capital gains tax
Distribution of tax losses
Establishment and administration costs etc.
2.2 AUSTRALIAN BUSINESS NUMBER (ABN)
The Australian Business Number (ABN) was introduced on 1 July 2000 to enable businesses in Australia to deal
with a range of government departments and agencies using a single identification number. The ABN is a public
number which does not replace your tax file number. ABN registration details become part of the Australian
Business Register (ABR), which the ATO maintains on behalf of the Commonwealth. You can access the publicly
available information contained in the ABR through the ABN Lookup web site.
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Why should I apply for an ABN?
The Australian Business Number (ABN) is your key to a quicker and smarter way of dealing with other businesses
and government. The ABN:
Helps you claim goods and services tax (GST) credits
Facilitates a single business activity statement
Allows you to claim any energy grants credits for which you qualify
Stops businesses deducting pay as you go (PAYG) withholding tax from payments to you
Allows businesses to easily confirm your details for ordering and invoicing purposes
If your business has an annual turnover of $75,000 or more, you must register for GST and you will need an ABN
to do this. If your business has a lower annual turnover, it's up to you whether you register. All non-profit
organisations with an annual turnover of $150,000 or more must register for GST and therefore need an ABN.
Also, businesses that need to be endorsed as a gift deductible recipient or an income tax exempt charity or both,
require an ABN.
Registering Your Business Name
A business name is simply a title under which a person, or other legal entity, trades. If the business structure is
that of a sole trader, a partnership or trust, you are required to register your business name in the state or
territory in which you will operate. You do not need to register a business name if you plan to conduct your
business under you or your partner’s first name and surname e.g. ‘Bill Bloggs, Builder.’
If you are planning to set up your business in more than one state, you must register your business name
separately in each state in which you intend to operate. Registration of a business name does not in itself give
you any proprietary rights. Only a trade mark can give you that kind of protection. To ensure you have exclusive
use of your name now and in the future throughout Australia, consider registering a trade mark. It is important
that you understand the eligibility requirements before you apply as well as how to describe your goods and
services. For further information, or to register a trademark, visit IP Professionals at www.ipaustralia.gov.au.
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Learning Activity 2.1 – Using the ATO to Decide Business Structure
This Activity may be completed in pairs.
1. Visit the ATO Website to research and access the information you need to write a simple proposal
(application) for a business structure. This may be based on your current plans for a business or a
hypothetical building or construction business.
2. Hint: Before deciding on structure consider short and long terms plans for the business.
3. Share what you discovered with the rest of your class.
You may use this space to take any notes:
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Learning Activity 2.2 – Email Your Accountant
This Activity should be completed individually.
1. Choose one of the types of businesses we have just studied for your new hypothetical business.
2. Write an email to your accountant explaining your proposal and reasons why you have chosen this
structure (sole trader, partnership, company or trust).
You may use this space to take any notes:
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SECTION 3: INSURANCE REQUIRMENTS
In this section we will examine insurance requirements within the construction industry on a state-by-state basis.
3.1 IN VICTORIA
Under the Building Act 1993, most people who carry out or undertake work in building must be registered as
building practitioners with the Building Practitioners Board and are required to carry the appropriate
insurance. Building practitioners are required to show proof of insurance when registering. There are four types
of insurance a Registered Building Practitioner may require:
Domestic Building Insurance
Professional Indemnity Insurance
Public Liability Insurance
Work Cover Insurance
Domestic Building Insurance
Domestic Building Insurance is required by all domestic builders who
enter into domestic building contracts in which the contract price for the
building work is more than $16,000. Practitioners must provide their
client with a copy of the policy and a certificate of currency covering
their property before taking a deposit or any money. Domestic Building
insurance covers the client if, before work is complete, the practitioner:
is deceased
is declared insolvent
disappears
It covers costs up to $300,000 to fix structural defects for six years, and non-structural defects for two years. In
all other cases, it is up to you to fix or complete works, or to pay any costs awarded.
Professional indemnity insurance
Professional indemnity insurance is required by the following building practitioner categories and classes:
Building surveyor
Building inspector
Quantity surveyor
Engineer - civil, mechanical, electrical and fire safety
Draftsperson - building design (architectural, interior and services)
Professional indemnity insurance covers the practitioner against legal liability resulting from any claim or claims
made during the period of insurance. A building professional is required to show evidence of their professional
indemnity insurance when renewing their registration with the Building Practitioners Board. Professionals
needing to renew their registration must ensure they have cover in place that insures them for all work carried
out under their registration. Commercial builders don’t have a mandatory requirement to hold an insurance
policy against structural defects (as of July 1 2014).
Evidence of an insurance policy against structural defects won’t be requested by the Victorian Building Authority
(VBA) and is not required for registration purposes for (commercial) builders. Any decision made by a registered
builder to cancel or not hold an insurance policy against structural defects is a commercial decision that should
be made in the context of the policies and processes in place by the practitioner to manage risks. If uncertainty
exists, registered (commercial) builders should seek independent expert advice.
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Public liability insurance
Public liability insurance is required by the following building practitioner categories and classes:
Builder - Demolisher (low-rise buildings, medium-rise buildings and unlimited)
Erector or supervisor (temporary structures)
Public liability insurance covers the building practitioner against legal liability resulting from any claim or claims
made during the period of insurance.
WorkCover insurance
WorkCover insurance is compulsory insurance for Victorian employers which is funded by their contributions.
It provides employers with insurance cover for the cost of benefits if your workers are injured or become ill
because of their work.
3.2 IN NEW SOUTH WALES
The HBA Act requires the builder to have insurance in place if the contract for residential building work is valued
at over $20,000. This insurance is the Home Building Compensation Fund, formerly known as the Home
Warranty Insurance Scheme. Insurance under the Home Building Compensation Fund needs to be provided by:
a builder or tradesperson before taking any money (including a deposit) from a home owner (including
an owner-builder) under a residential building contract and before starting any work under that
contract
a ‘spec’ builder before starting any residential building work on a property owned by the builder
a developer before entering into a contract for the sale of a property on which a builder is doing or has
done residential building work for the developer
Insurance threshold
From 1 February 2012, insurance under the Home Building Compensation Fund is required to be obtained where
the contract price is over $20,000 or, if the contract price is not known, the reasonable market cost of the labour
and materials involved is over $20,000.
Where the contract price or the reasonable market cost of the labour and materials involved does not exceed
the above threshold, there is no legal requirement to obtain insurance under the Home Building Compensation
Fund.
Contractors who carry out residential building work must still hold an appropriate licence with NSW Fair Trading
where the labour and materials involved are valued at over $5,000.
Those who contract and/or carry out specialist work (e.g. electrical wiring, plumbing, gas-fitting, air-conditioning
and refrigeration) require a licence regardless of the value of the work. In addition to the insurance required
under the HBA Act, other insurances to consider are:
Contract Works Insurance
Tradesman and Tools Insurance
Public & Products Liability
Commercial Vehicles
Surety / Performance Bonds
Management Liability
Business and Property Insurance
Domestic and Personal Insurance
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3.3 IN QUEENSLAND
Most residential building work done in Queensland valued over $3,300 (including labour and materials) must
have home warranty insurance. As part of the building process, the builder pays a premium to the QBCC to
insure the construction. The amount is included as part of the contract, and is paid before work begins. It may
protect the client where:
the licensed builder does not complete the contracted residential construction work and they have
terminated the contract
the contractor fails to rectify defective work
the building suffers from subsidence or settlement
Types of work that is insured:
construction of a new home, related roofed building, townhouse or multiple unit dwelling (no more
than 3 storeys)
the extension, addition, alteration, renovation or repair of a house, related roofed building (e.g. a
garage), townhouse or multiple unit dwelling (no more than 3 storeys)
replacement or refit of fixtures or fittings in a kitchen or bathroom
work on a deck or veranda, attached to a residence
building work that affects the structural integrity of the building
To register as a builder with the Queensland Building Construction Commission, in some instances you will be
required to produce evidence of having Professional Indemnity (PI) insurance. This applies to the following
classes:
Building Design – Low Rise
Building Design – Medium Rise
Building Design – Open
Hydraulic Services Design
Completed Residential Building Inspection
Site Classifier
Termite Management
For fire protection classes which require certification
Professional indemnity (PI) insurance
Professional indemnity (PI) insurance protects builders against the expenses associated with a negligence claim.
It covers the cost of defending a lawsuit, as well as any financial compensation awarded to the plaintiff. A
negligence claim can be made against a builder if an omission, action or advice is believed to have caused
financial loss. If a builder is found to be at fault, they are personally liable for providing financial recompense to
cover the client’s losses. PI insurance protects the builders by covering both the compensatory expenses and
any additional costs arising from the claim. In addition to PI insurance required by the QBCC, other insurances
to consider are:
Contract Works Insurance
Tradesman and Tools Insurance
Public & Products Liability
Commercial Vehicles
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Surety / Performance Bonds
Management Liability
Business and Property Insurance
Domestic and Personal Insurance
Fair trading legislation
The QLD Office of Fair Trading administers the QLD Fair Trading Act 1989. Explore their website for more
information.
Summary
Victoria
Domestic builders in Victoria must be registered with the Building Practitioners Board if they:
Handle a contract worth more than $5,000
Re-block, re-stump, demolish or remove a home regardless of the value of the work
Domestic Building Insurance is required by all domestic builders who enter into domestic building contracts
in which the contract price for the building work is more than $16,000. The four types of insurance a
Registered Building Practitioner may require are:
Domestic Building Insurance
Professional Indemnity Insurance
Public Liability Insurance
Work Cover Insurance
New South Wales
Insurance under the Home Building Compensation Fund needs to be provided by:
a builder or tradesperson before taking any money (including a deposit) from a home owner
(including an owner-builder) under a residential building contract and before starting any work
under that contract
a ‘spec’ builder before starting any residential building work on a property owned by the builder
a developer before entering into a contract for the sale of a property on which a builder is doing or
has done residential building work for the developer
Insurance is required by all domestic builders who enter into domestic building contracts in which the
contract price for the building work is more than $20,000.
Queensland
Domestic builders in QLD must be registered with the Queensland Building Construction Commission for most
types of building work. Professional Indemnity insurance is required for some classes of builder’s registration.
The four types of business structures that you may consider:
Sole trader
Partnership
Company
Trust
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Learning Activity 3.1 – Meeting insurance needs within the building sector
This Activity may be completed in pairs.
1. Explain the benefits of having the following insurance policies in place:
a. Domestic Building Insurance
b. Professional Indemnity Insurance
c. Public Liability Insurance
d. Work Cover Insurance
You may use this space to take any notes:
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SECTION 4: OHS/WHS REQUIREMENTS
Construction work is often high risk work. According to the
Australian Bureau of Statistics in the year 2013-2014 workers in
the construction industry were the fifth highest group who
reported a workplace injury at nearly 60 per 1,000 employed
persons. Workplace incidents could be reduced and avoided if
people within the workplace take care in ensuring their own
safety and that of others.
Workplace health and safety in Australia is directed by a system
of laws, regulations and compliance codes which set out the
responsibilities of employers and workers to ensure that safety
is maintained in the workplace. A number of industry bodies
have been set up in each State to assist with reducing the
number of workplace accidents and incidents. These
organisations aim to help reduce workplace injuries, enforce
safety laws, provide insurance, help injured workers re-enter the
workforce and manage compensation schemes. WorkSafe is the
name of the industry body in Victoria and that has implemented a number of rules and regulations to keep
workers safe. In NSW and QLD the industry body who deals with workplace safety is called WorkCover.
4.1 WHS AND OHS: WHAT’S THE DIFFERENCE?
From 1 January, 2012 the Commonwealth, state and territory governments (excluding Victoria) introduced a
new harmonised work health and safety law which aims to ensure work health and safety laws provide
regulators with functions including:
Providing advice and information to duty holders and the community
Monitoring and enforcing compliance with work health and safety laws
Fostering co-operative, consultative relationships between duty holders and the persons and
representatives they owe a duty to
Sharing information with other regulators; and
Conducting and defending proceedings under work health and safety laws
Until now, the Commonwealth, State and Territory Governments were responsible for making and enforcing
their own health and safety laws. Even though, these jurisdictions are similar, the variations led to confusion.
By developing the Model Work Health and Safety laws, Safe Work Australia, working with the Commonwealth,
State and Territories harmonised the act, regulations and codes of practice.
Some States have not been able to meet this deadline and are still operating with the previous Occupational
Health and Safety Legislation. At the time this learner guide was written, legislation was up to date. However,
care should be taken to update your knowledge on an ongoing basis to ensure that you do not give advice that
is out of date.
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Harmonisation
Objectives of the Harmonised
WHS Act
Objectives of the Victorian OHS Act
2004
Objectives of the Western
Australian OSH Act 1984
As specified in Section 3
(‘Object’), the main objective of
the WHS Act is ‘…to provide for a
balanced and nationally
consistent framework to secure
the health and safety of workers
and workplaces…’
This objective is to be achieved
through the Act by:
Protecting workers and other
persons against harm to their
health, safety and welfare
through the elimination or
minimization of risks arising
from work (or specified types
of substances or plant)
Providing for fair and
effective workplace
representation, consultation,
co-operation and issue
resolution in relation to work
health and safety
Encouraging unions and
employer organizations to
take a constructive role in
promoting improvements in
WHS practices, and assisting
persons conducting
businesses or undertakings
(PCBUs) and workers to
achieve a healthier and safer
working environment
Promoting the provision of
WHS advice, information,
education and training
Securing compliance with the
Act through effective and
appropriate compliance and
enforcement measures
The express objectives of the
Victorian OHS Act, as stated in
Section 2 (‘Objects’) are to:
Secure the health, safety and
welfare of employees and other
persons at work
Eliminate workplace health,
safety and welfare risks at the
source
Ensure the health and safety of
members of the public is not
placed at risk by the conduct of
undertakings by employers and
self-employed persons
Involve employees, employers,
and organizations representing
those persons, in the formulation
and implementation of health,
safety and welfare standards.
For all purposes under the Act, the
term ‘health’ includes psychological
health (per Section 5 [Definitions]).
Underpinning Principles: Under
section 4 (‘Principles of health and
safety protection’), five (5) key
health and safety principles underpin
the Act:
1. Employees, other persons at
work and members of the public
must be given the highest level
of protection against risks to
their health and safety that is
reasonably practicable in the
circumstances
The express objectives of the
Western Australian OHS Act (per
Section 5 [‘Objects’]) are to:
Promote and secure the
safety and health of persons
at work
Protect persons at work
against hazards
Assist in securing safe and
hygienic work environments
Reduce, eliminate and
control the hazards to which
persons are exposed at work
Foster cooperation and
consultation between, and to
provide for the participation
of, employers and employees
and associations
representing them in the
formulation and
implementation of safety and
health standards
Provide for formulation of
policies and for the
coordination of the
administration
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Appropriately scrutinizing and
reviewing of actions taken by
persons exercising powers
and performing functions
under the Act
Providing a framework for
continuous improvement and
progressively higher
standards of work health and
safety
Maintaining and
strengthening the national
harmonization of WHS laws
and to facilitate a consistent
national approach in all
jurisdictions.
For all purposes under the Act,
the term ‘health’ means physical
and psychological health (per
Section 4 [Definitions]).
Underpinning Principle: The key
principle underpinning the Act is
that workers and other persons
should be given the highest level
of protection against harm to
their health, safety and welfare
from hazards and risks arising
from work (or specified types of
substances or plant) as is
reasonably practicable.
The term ‘reasonably practicable’
means what could reasonably be
done at a particular time to
ensure health and safety
measures are in place (as defined
in Section 18 of the Act).
2. People who control or manage
matters that create (or may
create) health or safety risks in
the workplace are responsible
for eliminating or reducing those
risks so far as is reasonably
practicable
3. Employers and self-employed
persons should be proactive, and
take all reasonably practicable
measures, to ensure health and
safety at workplaces and in the
conduct of undertakings
4. Information and ideas about risks
to health and safety and how to
control them should be shared
between employers and
employees
5. Employees are entitled, and
should be encouraged, to be
represented in relation to health
and safety issues.
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4.2 WHO IS RESPONSIBLE FOR A SAFE WORKPLACE?
From 1 January, 2012 the Commonwealth, state and territory governments (excluding Victoria) introduced a
new harmonised work health
Work health and safety legislation is the organisation of the common law duty of care. This means that all duty
holders must do everything that is ‘reasonably practicable’ to protect the work health and safety of everyone at
the workplace. This duty of care falls on all:
Employers
Company directors
Managers
Supervisors
Employees
WHS representatives and committees
Contractors
Workers have a responsibility to:
take reasonable care for their own health and safety
take reasonable care for the health and safety of others
comply with any reasonable instructions, policies and procedure given by their employer, business or
controller (or other PCBU) of the workplace
PCBU in WHS legislation means ‘person conducting a business or undertaking.'
Employers have a responsibility to:
talk to their workers to identify any potential hazards
put systems in place for the safe use and maintenance of plant and machinery, such as machine guards
provide suitable information, instruction and supervision, especially to new workers
ensure there are adequate workplace facilities including toilets, drinking water, washing and eating
facilities and first aid
record any workplace incidents in a register of injuries and respond to hazards quickly
prepare emergency plans
manage the risks of any remote and isolated work
have a return to work program to help injured workers with their recovery and return to work
provide information on the safe use of equipment etc.
What is ‘reasonably practicable?’
This health and safety term means doing what you can, within reason, to ensure the health of safety of others.
In other words, if you’ve taken practical and realistic measures to be safe at work, or when a potentially
dangerous situation arises, done everything possible to respond, you’ve been ‘reasonably practicable.’
4.3 DUTY OF CARE
This term when used in a WHS/OHS context applies to both employers and employees in the workplace. Both
parties share responsibility for creating and maintaining a safe work space. Employers have a duty of care to
provide a safe methods of working and a safe environment and employees have a duty of care to follow
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whatever directions they are given by the employer and to not act in a way that poses a risk to themselves or
those around them.
Induction training
The National Standard for Construction Work [NOHSC: 1016 (2005)] (the National Standard), aims to protect
persons from the hazards associated with construction work. This Code of Practice provides guidance to persons
working in the general and residential construction sectors on the types of induction training that may be needed
to provide construction workers with an awareness and understanding of common hazards on construction sites
and how they should be managed.
Induction training requirements by state
In Victoria:
Two types of OHS induction training are required before starting work on construction projects – construction
induction training and site induction. All people performing construction work require proof that they have
completed a general OHS construction induction for the industry. The induction training must be provided by a
Registered Training Organisation (RTO).
In New South Wales and Queensland:
Three types of WHS induction training are required before starting work on construction projects:
(1) Construction induction training; (2) Site induction and (3) Task specific induction.
(1) General induction - provides persons entering the
construction industry with a basic knowledge of
requirements under OHS laws, the common hazards and
risks likely to be encountered on construction sites and how
these risks should be controlled.
(2) Site induction - provides information and instruction to
anyone engaged on a particular construction site with a
knowledge of the contractor’s rules and procedures for site
safety, emergency management, the supervisory and
reporting arrangements and other site-specific issues.
(3) Task-specific induction - provides information and
instruction to anyone undertaking a particular construction activity of the risk factors and control measures
relating to that task.
All people performing construction work require proof that they have completed a general WHS construction
induction for the industry. The induction training must be provided by a Registered Training Organisation (RTO).
4.4 EVIDENCE OF TRAINING
An employer must accept any of the following items as evidence that the worker has completed their
construction induction training.
In Victoria:
A construction induction card issued by Work Safe following successful completion of induction training
by an RTO
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A ‘red card’, which shows that the person completed the previous Victorian Construction Industry Basic
Induction Course, which existed before 1 July 2008. Red cards remain valid after 1 July 2008, and do
not need to be transferred to construction induction cards
A construction statement of attainment issued by an RTO, pending processing of a construction
induction card
Recognised evidence of construction induction training (e.g. a statement or card issued under similar
requirements in another Australian state or territory)
White Card:
A White Card course prepares an individual working in construction with the knowledge and skills to work safely.
After obtaining the card, he or she will adhere to the regulations prescribed by the OHS in the state of Victoria.
In New South Wales:
A construction induction card (previously known a White Card) issued by WorkCover following
successful completion of induction training by an RTO
A construction statement of attainment issued by an RTO, pending processing of a construction
induction card
Recognised evidence of construction induction training (e.g. a statement or card issued under similar
requirements in another Australian state or territory)
Construction Induction Card (CIC):
A CIC course prepares an individual working in construction with the knowledge and skills to work safely. After
obtaining the card, he or she will adhere to the regulations prescribed by the WHS Act in the state of NSW.
In Queensland:
A construction induction card (previously known a Blue Card) issued by WorkCover following successful
completion of induction training by an RTO
A construction statement of attainment issued by an RTO, pending processing of a construction
induction card
Recognised evidence of construction induction training (e.g. a statement or card issued under similar
requirements in another Australian state or territory)
Construction Induction Card (CIC):
A CIC course prepares an individual working in construction with the knowledge and skills to work safely. After
obtaining the card, he or she will adhere to the regulations prescribed by the WHS Act in the state of QLD.
4.5 RISK
The constantly changing nature of construction work distinguishes it from other types of work. Different hazards
and risks emerge on a daily basis and coordination of work to
manage risk is further complicated by:
Staggered commencement and conclusion of stages of
a construction project
High turnover of workers and temporary workplaces
The prevalence of contractors and subcontractors in a
highly competitive market
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The hazards faced by construction workers are many and varied. The main causes of injury and death are:
Manual handling
Slips, trips and falls
Electrocution
Structural collapse
Working with powered plant and equipment
Roadside traffic
Legislation, Acts and Regulations by State
The Act in Victoria:
The Occupational Health and Safety Act 2004 (the Act) is the cornerstone of legislative and administrative
measures to improve occupational health and safety in Victoria. The Act sets out the key principles, duties and
rights in relation to occupational health and safety. The general nature of the duties imposed by the Act means
that they cover a very wide variety of circumstances, do not readily date and provide considerable flexibility for
a duty holder to determine what needs to be done to comply.
The Regulations in Victoria:
The Occupational Health and Safety Regulations 2007 are made based on the Act. They specify the ways duties
imposed by the Act must be performed, or prescribe procedural or administrative matters to support the Act,
such as requiring licenses for specific activities, keeping records, or notifying certain matters.
The Act in New South Wales:
The legislation in NSW for workplace health and safety is the Work Health and Safety Act 2011. The Act sets out
the key principles, duties and rights in relation to workplace health and safety. The general nature of the duties
imposed by the Act means that they cover a very wide variety of circumstances, do not readily date and provide
considerable flexibility for a duty holder to determine what needs to be done to comply.
The Regulations in New South Wales:
The Work Health and Safety Regulation 2011 are made based on the Act. They specify the ways duties imposed
by the Act must be performed, or prescribe procedural or administrative matters to support the Act, such as
requiring licenses for specific activities, keeping records, or notifying certain matters.
The Act in Queensland:
The legislation in QLD for workplace health and safety is the Work Health and Safety Act 2011. The Act sets out
the key principles, duties and rights in relation to workplace health and safety. The general nature of the duties
imposed by the Act means that they cover a very wide variety of circumstances, do not readily date and provide
considerable flexibility for a duty holder to determine what needs to be done to comply.
The Regulations in Queensland:
The Work Health and Safety Regulation 2011 are made based on the Act. They specify the ways duties imposed
by the Act must be performed, or prescribe procedural or administrative matters to support the Act, such as
requiring licenses for specific activities, keeping records, or notifying certain matters.
Policy
Not every term in legislation is defined or explained in detail. Also, sometimes new circumstances arise (like
increases in casual and contract work, or completely new industries with new technologies which produce new
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hazards) which could potentially impact on the reach of the law. Therefore, from time to time WorkCover or
WorkSafe must make decisions about how it will interpret something that is referred to in legislation, or act on
a particular issue, to ensure clarity. In these circumstances, WorkCover or WorkSafe will develop a policy. A
policy is a statement of what WorkCover or WorkSafe understands something to mean, or
what WorkCover/WorkSafe will do in certain circumstances.
4.6 LICENCE TO PERFORM HIGH RISK WORK
Again, the requirements differ from state to state. You should be familiar with the requirements for the state in
which your work.
In Victoria:
A licence to perform high risk work is required before undertaking any of the following work:
High risk work (e.g. scaffolding and rigging, operating cranes and forklifts, and using boilers and other
pressure equipment)
Removing specific types and amounts of asbestos
Operating a major hazard facility
Using scheduled carcinogens
Transporting dangerous goods
Using dangerous goods that pose a security concern
(High Consequence Dangerous Goods)
Compliance codes in Victoria:
Compliance codes provide practical guidance to those who have
duties or obligations under the OHS Act. They aim to provide
easy to understand information on how to comply. This information, if applied appropriately, will mean those
who follow it are deemed to have complied with their obligations under the OHS Act. The eight compliance
codes now available are (*these codes replace existing Codes of Practice):
Communicating occupational health and safety across languages*
Workplace amenities and work environment*
Confined spaces*
First aid in the workplace*
Prevention of falls in general construction*
Foundries*
Managing asbestos in workplaces
The codes were developed after extensive consultation with industry, employers, employees, governmental
agencies and the community to provide greater certainty about what constitutes compliance under the OHS Act.
If conditions at the workplace, or the way work is done, raise different or additional risks not covered by the
compliance code, compliance needs to be achieved by another means. WorkSafe publishes guidance to assist
with this process at www.worksafe.vic.gov.au.
Evidence of a failure to observe a compliance code may be used as evidence in proceedings for an offence under
the OHS Act or Regulations. A WorkSafe inspector may cite a compliance code in a direction, or as a condition in
an improvement notice or a prohibition notice as a means of achieving compliance.
In New South Wales:
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A High Risk Work (HRW) licence is required to operate or use equipment such as forklifts, cranes (including tower
cranes, mobile cranes, vehicle loading cranes, bridge and gantry cranes), hoists (including personnel and
materials hoists), concrete placing booms, elevated work platforms and pressure equipment (boilers, turbines
and steam engines) as well as for dogging, rigging and erecting scaffolding.
Codes of practice in New South Wales:
A code of practice provides detailed information on how you can achieve the standards required under the work
health and safety laws. These do not replace the WHS laws, but codes of practice can be issued to help make
understanding what you have to do a little easier. An inspector can refer to a code of practice when issuing
an improvement or prohibition notice.
Under the Work Health and Safety Act 2011, codes of practice are admissible in court proceedings. Courts may
regard a code of practice as evidence of what is known about a hazard, risk or control, and rely on it to determine
what is 'reasonably practicable' in the circumstances to which the code relates.
It is recognised that equivalent or better ways of achieving the required work health and safety outcomes may
be possible. For that reason compliance with codes of practice is not mandatory providing that any other method
used provides an equivalent or higher standard of work health and safety than suggested by the code of practice.
You should be familiar with the Construction Work Code of Practice July 2014 issued by NSW WorkCover which
provides guidance to principal contractors and other persons conducting a business or undertaking who carry
out construction work on how to meet the health and safety requirements under the WHS Act and Regulations
relating to construction work.
In Queensland:
You should be familiar with the Queensland Code of Practice for the Building and Construction Industry.
4.7 BUILDING SAFETY SIGNS
Health and safety laws require that people on or near construction sites are warned of all hazardous activities
taking place. Before any construction work begins, builders must ensure that an adequate number of general
safety signs, depending on the size and complexity of the job site, are erected at the workplace.
Safety signs give a specific message where exposure to a workplace hazard is possible. The message may be to:
prevent accidents
signify health hazards
indicate the location of fire equipment
give guidance or instruction in an emergency
The Australian Standard 1319 sets the design standard for all workplace safety signs. There are different
categories of signs according to the message they send.
Prohibition Signs – these indicate something you should not do. They
have a red border with a line through it, a white background and black
symbol.
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Mandatory Signs – These tell you that you must wear special safety
equipment or
PPE. They have a solid blue circle with a white symbol.
Hazard Warning Signs – These warn of a danger or risk to your safety.
They are a yellow triangle with a black border and black symbol.
Emergency Information Signs – These show where emergency equipment
is kept. They are a solid green square or rectangle with a white symbol or
text.
Fire Signs – These show the location of fire alarms and fire-fighting
equipment. They are a solid red rectangle with white text.
Dangerous Good Signs (also known as hazardous chemical signs) - These
are defined in the Australian Dangerous Good Code. They indicate what
are used in a tank or package and how it must be transported, stored and
handled.
4.8 APPLYING SAFETY KNOWLEDGE
It is a legal requirement that legislation, standards and applicable codes of practice are applied to standard
business practices. Supervisors and directors of organisations carefully assess if the activities and practices that
are documented and completed in a way that supports both the aim of the company but also complies with
legislation and regulations.
Researching legislative and regulatory requirements must be completed on an on-going basis this should be
done by individuals who feel comfortable reading legislation and regulations. Most states and territories
produce guides to support legislation and can help you narrow down knowledge required. Each of these guides
summarise important aspects of legislation.
Each organisation must include a variety workplace health and safety information and data that could include:
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Compensation claims data
First aid data
Incident reports
Injury reports
Risk assessments
Safe work procedures
Training information and data
WHS/OHS consultation and participation records
Industry best practice will vary depending upon the trades involved. When determining the best practice for
your site, you need to look at the:
Site activities
Trades involved
Requirements of the plans and specifications
Environmental conditions
Local authority factors
Permit conditions
Summary
Construction work is high risk. Workplace health and safety in Australia is directed by a system of laws,
regulations and compliance codes which set out the responsibilities of employers and workers to ensure that
safety is maintained in the workplace. A number of industry bodies have been set up in each State to assist with
reducing the number of workplace accidents and incidents. These organisations aim to help reduce workplace
injuries, enforce safety laws, provide insurance, help injured workers re-enter the workforce and manage
compensation schemes. In Victoria the governing body is called WorkSafe, in NSW and QLD the governing body
is called WorkCover.
The main causes of injury and death in the construction industry are:
Manual handling
Slips, trips and falls
Electrocution
Structural collapse
Working with powered plant and equipment
Roadside traffic
OHS/WHS and duty of care apply to both employers and employees in the workplace. Both parties share
responsibility for creating and maintaining a safe work space. Employers have a duty of care to provide a safe
methods of working and a safe environment and employees have a duty of care to follow whatever directions
they are given by the employer and to not act in a way that poses a risk to themselves or those around them.
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Learning Activity 4.1 – Research Legislation
This Activity may be completed in pairs.
1. Research the Occupational Health and Safety Act 2004 and outline the main requirements of the Act.
2. List four codes of practice relevant to the construction industry.
3. Explain ‘duty of care.’
4. Explain the employer OHS responsibilities to ensure consultation requirements are met.
5. Explain the employee OHS responsibilities to ensure consultation requirements are met.
6. Explain the importance of site signage.
7. In your own words, explain what a White Card is and the benefits of having this on a construction site.
You may use this space to take any notes:
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SECTION 5: ACTS, STANDARDS, REGULATIONS AND CODES
There are so many aspects to building legislation, so let’s begin this section by breaking it down state by state.
5.1 STATE OVERVIEW
In Victoria:
Victoria's building legislation system was set up under a Victorian Act of Parliament entitled the Building Act
1993. The Act introduced major changes in building controls to improve the Victorian building industry. Of
particular note, the Act introduced building permit approvals by private building surveyors. It also introduced
compulsory registration and insurance for builders and certain other categories of building practitioners. These
innovations have been designed to assist building owners, building surveyors and other industry practitioners
to produce buildings that are safe, liveable and energy efficient in a cost effective and timely manner for all
Victorians.
What legislation governs the building activity?
All building work must comply with the Building Act 1993 (the Act), Building Regulations 2006 (the
Regulations) and the Building Code of Australia (the BCA) unless specifically exempted. The Act sets out the legal
framework for the regulation of construction of buildings, building standards and
maintenance of specific building safety features in Victoria. The objectives of
the Act include:
To establish, maintain and improve standards for the construction and
maintenance of buildings
To facilitate the adoption and efficient application of national uniform
building standards and the accreditation of building products
To enhance the amenity of buildings and protect the safety and
health of people who use buildings
To facilitate and promote the cost-effective construction of
buildings
To provide an efficient and effective system for issuing building
and occupancy permits
The Regulations are derived from the Act and contain, amongst other
things, the requirements relating to building permits, building inspections, occupancy permits, and enforcement
of the Regulations and maintenance of buildings. The Regulations reference the BCA as a technical reference
that must be complied with.
Where does the building commission fit in?
The Building Commission and statutory bodies were established by the Building Act 1993 to administer Victoria's
building regulation system. The four statutory bodies established by the Building Act 1993 are the:
Building Advisory Council
Building Regulations Advisory Committee
Building Practitioners Board
Building Appeals Board
The Commission and the four statutory bodies:
Regulate the Victorian building industry
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Register 17,000 building practitioners in Victoria
Informs consumers of their rights and responsibilities when building and renovating
Administer building legislation, the Building Act 1993 and Building Regulations 2006
Advise the Minister for Planning and the Victorian Government on building policy
Resolve disputes as part of the Building Advice & Conciliation Victoria service
Accredit building products, construction methods, designs, components and systems associated with
building
Determine disputes and appeals arising from the Building Act 1993
Communicate building legislation changes
Promote improved building standards both nationally and internationally
Provide comprehensive information on building activity
Facilitate research and development in the building industry
Promote use of leading information technology and telecommunications technology
Encourage sustainable building design and construction
In New South Wales:
The Home Building Regulation 2014 covers the following:
Contracting for residential building work and specialist work
Contractor licences, certificates and owner-builder permits
Resolution of building disputes and building claims
Advertising
Insurance requirements
Exemptions
Fees
Register (details of contractors licensed under the Act)
Queensland:
The Building Act 1975 is the legislation which covers building work in Queensland. This Act regulates building
development approvals, building work, building classification, building certifiers and pool safety inspectors. It
provides particular matters about swimming pool safety, sustainable buildings and other purposes. The Act is
supported by the Building Regulation 2006.
5.2 NATIONAL CONSTRUCTION CODE (NCC)
The Australian Building Codes Board (ABCB) oversees the publication of the National Construction Code (NCC).
The ABCB comprises representatives of the Australian, state and territory governments, as well as local
government representatives and four building industry representatives. The ABCB has an independent
chairperson and a number of full time staff that assist it in achieving its goals.
The NCC comprises four components, three volumes and an appendix:
National Construction Codes Series Volume One: Building Code of Australia Class 2 to 9 Buildings;
Volume One Appendices – Variations and Additions.
National Construction Codes Series Volume Two: Building Code of Australia Class 1 and 10 Buildings.
National Construction Code Series Volume Three: Plumbing Code of Australia
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Each state and territory adopts the NCC into its own legislation as the technical basis of its building regulations.
Therefore, the NCC is part of the law throughout Australia and you need to comply with it, unless the law
provides a process through which you can be granted a
dispensation.
The goals of the NCC are to enable the achievement and
maintenance of acceptable standards of structural
sufficiency, safety (including safety from fire), health and
amenity for the benefit of the community now and in the
future. The NCC contains technical provisions for the design
and construction of buildings and other structures, covering
such matters as structure, fire resistance, access and egress,
services and equipment, and certain aspects of health and amenity. You can find more information on the ABCB
website (www.abcb.gov.au).
5.3 THE BUILDING CODE OF AUSTRALIA
The Building Code of Australia (BCA) is produced and maintained by the Australian Building Codes Board (ABCB)
on behalf of the Australian Government and State and Territory Governments. It is a uniform set of technical
provisions for the design and construction of buildings and other structures. It is fully performance based and
allows for state variations to provide additional requirements or cater for specific community expectations. A
performance based approach defines the way of achieving a specified outcome without prescribing a particular
method.
The BCA has been given the status of building regulations by all States and Territories. The BCA is split into two
volumes.
Volume 1 deals with buildings in Classes 2 to 9
Volume 2, also known as the Housing Provisions, deals with buildings of Class 1 and 10
The BCA classifies buildings by their use. A building may be made up of a number classes if it has a mixed use.
The BCA identifies the following building classes for Volume 2:
Class 1(a) A single dwelling or attached dwellings (e.g. terrace, duplex, etc.) where each dwelling is
separated by a fire wall;
Class 1(b) One or more buildings that constitute a boarding house, guests house, hostel of small scale
(i.e. not exceeding 12 persons or 300m2 in floor area);
Class 10(a) A non-habitable building being a private garage, shed or the like;
Class 10(b) A structure (e.g. a fence, wall, mast, swimming pool, etc.)
Volume one is split into nine sections, with the first section containing General/ administrative provisions and
the remainder containing technical provisions.
Volume two is split into three sections. They are:
(Section 1) General Provisions
This contains information such as definitions, how buildings are to be classified and the list of guidance
documents such as Australian Standards that have been referenced by the BCA as ‘deemed-to-satisfy’
solutions.
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(Section 2) Performance Provisions
This section is further split into five subsections entitled Structure, Damp and Weatherproofing, Fire
Safety, Health and Amenity and Safe Movement and Access. Within each subsection the Objectives,
Functional Statements and performance requirements are stated.
(Section 3) Acceptable Construction
This section, also known as the acceptable construction manual, contains the ‘deemed-to-satisfy’
building solutions for Class 1 and 10 buildings. The section is split into 11 subsections, namely Site
Preparation, Footings and Slabs, Masonry, Framing, Roof and Wall Cladding, Glazing, Fire Safety, Health
and Amenity, Safe Movement and Access, Additional Construction Requirements and Structural Design
manuals.
The BCA Goal
The goal of the BCA is to enable the achievement of nationally
consistent, minimum necessary standards of relevant, health,
safety (including structural safety and safety from fire), and
amenity and sustainability objectives efficiently.
This goal is applied so:
There is a rigorously tested rationale for the regulation
The regulation generates benefits to society greater
than the costs (that is, net benefits)
The completive effects of the regulation have been
considered and the regulation is no more restrictive than is necessary in the public interest
There is no regulatory or non-regulatory alternative that would generate higher net benefits
What does the BCA cover?
The BCA contains technical provisions for the design and construction of buildings and other structures, covering
such matters as structure, fire resistance, services and equipment, and energy efficiency as well as certain
aspects of health and amenity.
Hierarchy of the Performance-Based BCA
The performance-based BCA was drafted after consideration of numerous overseas models (including the New
Zealand, British, Swedish and Dutch examples) to suit the Australian building regulatory environment. This has
meant that the performance-based BCA substantially includes the technical requirements from the previous
BCA90, with a 'performance hierarchy' built around them. The hierarchy of the BCA is shown below.
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The following is an explanation of the terms used and how they operate in practice.
Level 1 lists the Objectives. These items represent the reason the community wants a matter regulated. They
are primarily expressed in general terms, and usually refer to the need to safeguard people and protect adjoining
buildings or other property. An example of an Objective from the BCA is: ‘To safeguard the occupants from injury
or loss of amenity caused by inadequate height of a room or space.’
Level 2 includes the Functional Statements. These set out in general terms for how a building could be expected
to satisfy the Objectives (or community expectations). An example of a Functional Statement from the BCA is:
‘A building is to be constructed to provide height in a room or space suitable for the intended use.’
Level 3 contains the Performance Requirements. These outline a suitable level of performance that must be met
by building materials, components, design factors, and construction methods in order for a building to meet the
relevant Functional Statements and, in turn, the relevant Objectives.
The Performance Requirements are the core of the BCA and are the only parts of the code with which
compliance is mandatory. An example of a performance Requirement in the BCA is: ‘A room or space must be of
a height that does not unduly interfere with its intended function.’
Level 4 contains Building Solutions that set out the means of achieving compliance with the Performance
requirements. The BCA provides for two methods that can be followed to develop a Building Solution.
Level 4a includes the Deemed-to-Satisfy Provisions. These include examples of materials, components, design
factors, and construction methods which, if used, will result in compliance with the Performance Requirements
of the BCA. An example of a Deemed-to-Satisfy Provision in the BCA is: ‘Ceiling heights must be not less than 2.4
metres in a habitable room.’
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Level 4b lists the Alternative solutions. The key to the performance-based BCA is that there is no obligation to
adopt any particular material, component, design factor or construction method. An approval authority may still
issue an approval if it differs in whole or in part from Deemed-to-Satisfy Provisions described in the BCA if it can
be demonstrated that the design complies with the relevant Performance Requirement.
New South Wales specific:
Construction work code of practice
The Code of Practice for Construction Work is an approved code of practice under section 274
of the Work Health and Safety Act (the WHS Act). An approved code of practice is a practical guide to achieving
the standards of health, safety and welfare required under the WHS Act and the Work Health and Safety
Regulations (the WHS Regulations). This Code should be read in conjunction with other codes of practice on
specific hazards and control measures relevant to the construction industry including:
Demolition Work
Excavation Work
Managing the Risk of Falls at Workplaces
Managing Noise and Preventing Hearing Loss at Work
Preventing Falls in Housing Construction
Confined Spaces
Hazardous Manual Tasks
How to Manage and Control Asbestos in the Workplace,
How to Safely Remove Asbestos
NSW Building and Construction Industry code of practice for procurement: Building and construction
The Code of Practice for Procurement outlines how the New South Wales Government will conduct its
procurement activities when interacting with the private sector.
The Code sets the framework for all business relationships by:
Establishing the standards of behaviour expected from government agencies (as clients), tenderers,
service providers, employer and industry associations and unions
Requiring a strong commitment to continuous improvement and best practice performance by all
participants in the supply chain
The Implementation Guidelines to the New South Wales Code of Practice for Procurement: Building and
Construction (the Guidelines) have been in force since 1 July 2013. These apply to building and construction
companies that bid or tender for NSW Government infrastructure work. The Guidelines reflect the NSW
Government’s commitment to greater productivity within the State’s building and construction industry, and
are designed to ensure that the NSW Government maximises value for money on its spending on infrastructure
projects.
In particular, the Guidelines are directed to supporting outcomes associated with compliance with the law,
productivity, safety and freedom of association. The Construction Compliance Unit has been established within
NSW Industrial Relations to monitor compliance with, and receive reports of alleged breaches of the Guidelines.
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Queensland specific:
Queensland development code
The Building Code of Australia provides a nationally uniform set of technical building standards. However, it
currently contains numerous additional provisions specific to Queensland. As the number of these provisions
increases, it is not practical to include them in the national code. For example, new mandatory standards for
Queensland, such as 'Fire safety in budget accommodation', are included in the Queensland Development Code
rather than the Building Code of Australia.
Some of the Queensland variations to the Building Code of Australia are inserted into the Queensland
Development Code. The application of these standards is mandatory and is enforceable by building certifiers. If
there is an inconsistency between the Building Code of Australia and the Queensland Development Code, the
Queensland Development Code prevails.
Queensland Government Building and Construction Industry Payments Act
The Building and Construction Industry Payments Act 2004 (Payments Act) ensures that all parties in the
contractual chain are given sufficient protection to receive payment for work undertaken. It applies to all
commercial construction contracts, including the supply of related goods and services, in Queensland.
While the Payments Act does not cover residential building work, a subcontractor on a residential project can
call upon the Payments Act to obtain payment from the contractor. To gain protection under the Payments Act,
you must adhere strictly to the provisions and procedures set out for progress payments, including payment
claims, payment periods and payment schedules.
The Domestic Building Contracts Act
The Domestic Building Contracts Act 2000 regulates certain domestic building contracts, among other purposes.
The purpose of the act in regulating domestic building contracts is to:
Achieve a reasonable balance between the interests of building contractors and building owners
Maintain appropriate standards of conduct in the building industry.
The Act is administered by the Queensland Building and Construction Commission (QBCC).
If you carry out domestic building work valued at more than $3,300 in Queensland, the Domestic Building
Contracts Act requires you to have a written contract with your clients, and to give them a signed copy and a
QBCC-approved Contract Information Statement.
Subcontractors Charges Act
The Subcontractors’ Charges Act 1974 enables subcontractors to secure a statutory charge over money owed
(or allegedly owed) to them by their contractor. In effect, the charge is handed to the principal (owner) to secure
disputed money away from the contractor. The money is then frozen pending a final resolution through the
courts. The Act is administered by the Queensland Building and Construction Commission.
Code of Practice for Construction Work
The Code of Practice for Construction Work is an approved code of practice under section 274
of the Work Health and Safety Act (the WHS Act). An approved code of practice is a practical guide to achieving
the standards of health, safety and welfare required under the WHS Act and the Work Health and Safety
Regulations (the WHS Regulations). This Code should be read in conjunction with other codes of practice on
specific hazards and control measures relevant to the construction industry including:
Demolition Work
Excavation Work
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Managing the Risk of Falls at Workplaces
Managing Noise and Preventing Hearing Loss at Work
Preventing Falls in Housing Construction
Confined Spaces
Hazardous Manual Tasks
How to Manage and Control Asbestos in the Workplace,
How to Safely Remove Asbestos
5.4 WHAT IS A STANDARD?
Standards are published documents setting out specifications and procedures designed to ensure products,
services and systems are safe, reliable and consistently perform the way they were intended to. They establish
a common language, which defines quality and safety criteria. Standards may come in the form of documents
such as:
Australian Standards®
International Standards and Joint Standards
Codes
Specifications
Handbooks
Guidelines
These documents are practical and do not set impossible goals. They are based on sound industrial, scientific
and consumer experience and are constantly reviewed to ensure they keep pace with new technologies. They
cover everything from consumer products and services, construction, engineering, business, information
technology, human services to energy and water utilities, the environment and much more.
Australian Standards make a sustained contribution to generating national wealth, improving our quality of life,
increasing employment, improving safety and health and using our national resources more efficiently. Codes,
Acts, regulations and standards in the construction industry include things such as the latest editions of:
AS1720 Timber structures
AS3600 Concrete structures
AS4100 Steel structures
relevant Australian building and construction standards
relevant state or territory fair trading Acts and regulations
relevant state, territory and local authority planning and other approval requirements
Timber Framing Code of Australia 1684
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The benefits of standards
1. Standards protect Australians
Australians at home, at play and at work are made safer by Standards. Traffic lights,
footpaths, power points, seatbelts and child restraints, smoke and fire alarms are all
underpinned by Australian Standards. Standards give businesses and consumer’s
confidence that the goods and services they are developing or using are safe, reliable and
will do the job they were intended for. They protect Australian tradesmen - builders,
electricians, plumbers - and their customers.
2. Standards support Australian innovation
Standards provide a platform on which to build new and exciting ideas. As
our world changes, new Standards are introduced to reflect the latest
technologies, innovations and community needs - redundant Standards are
discarded. New risk management Standards have improved business practice
while information and communications technology Standards have helped
the spread of 'cutting edge' technology across emerging industry practice.
3. Standards boost Australian production and productivity
Standards save businesses time and money, as well as serving to cut
production costs. They drive economies of scale, the use of common
parts and specifications, help cut energy bills and foster new
technologies. The Federal Government uses Australian and
international record-keeping Standards to handle and move
information around its vast networks. Small businesses become more
efficient and grows by using Standards, guidelines and handbooks
developed by industry experts.
4. Standards make Australian businesses more competitive
Products that comply with Australian Standards have a
competitive edge over products that don't - consumers know
the difference. Businesses know products made to Australian
Standards have more credibility. Australian exporters using
international Standards have a head start when they move into
overseas markets.
5. Standards link Australia to the world
Standards ensure products manufactured in one country can be sold and
used in another. For example, a nut made in Melbourne fits a bolt made
in London. Standards reduce technical barriers to international trade,
increase the size of potential markets and position Australian firms to
compete in the world economy. Around 70 per cent of all new Australian
Standards are based on international equivalents.
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6. Standards compliment Australian regulation and make markets work better
Around a third of all Australian Standards form some part of Territory, State or Federal
law. They are at the heart of the Australian Building Code and the Trade Practices Act.
Standards help make laws and regulations consistent across Australia. By using a
Standard, a South Australian consumer law becomes consistent with a NSW fair
trading regulation. Standards offer an alternative to regulation, with less red tape and
business costs, while still providing security for families and small business consumers.
7. Working on Australian Standards rewards participants
Being a part of an Australian Standards development team has its own
rewards - increased knowledge, stronger business networks and
competitive advantages. There is no better personal satisfaction than
knowing an Australian Standard has made the world a safer place.
5.5 COMMON STANDARDS
The current edition of the Building code of Australia (BCA) references approximately 160 Australian and
International Standards. Typically each year, the BCA is updated and released in May by the Australian Building
Codes Board (ABCB). Here is a list of common standards that area referenced in the BCA that apply to domestic
building work:
AS 3700-2001 - Masonry structures
AS 1684.4-2010 - Residential Timber framed construction
AS 2870 - Residential slabs and footings-construction
AS 1288 - Glass in buildings
AS 3959-2009 - Construction of buildings in bushfire-prone areas
AS 3740 - Waterproofing of wet areas in residential buildings
Victoria specific Building Regulations:
Building Regulations 2006
The Building Regulations 2006 is the main set of regulatory documentation governing building in Victoria and
sets out many Australian standards. The Building Regulations are incorporated into the Building Act, and contain
amongst other things, the requirements, relating to building permits, building inspections and occupancy
permits. The Building Regulations are enforced and administered by building surveyors, Local Government, and
the Building Commission.
The objectives of the regulations are, among other things, to prescribe standards for the construction and
demolition of buildings. The Building Regulations often make reference to Australian Standards and the Building
Code of Australia (BCA). Australian Standards recommend how design and construction is to be carried out. The
Standards are the minimum benchmarks in the industry.
Queensland specific Building Regulations:
The BCA includes a number of provisions specific to Queensland. As it is not practical to include these in the
national code some of the Queensland variations to the Building Code of Australia are inserted into the
Queensland Development Code.
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Summary
All building work must comply with the relevant Act for your state. The Building Code of Australia (BCA) is
produced and maintained by the Australian Building Codes Board (ABCB) on behalf of the Australian Government
and State and Territory Governments. The BCA contains technical provisions for the design and construction of
buildings and other structures covering such matters as structure, fire resistance, access and egress, services
and equipment, and energy efficiency as well as certain aspects of health and amenity.
Standards are specifications and procedures designed to ensure products, services and systems are safe, reliable
and consistently perform the way they were intended to. The current edition of the Building Code of Australia
(BCA) references approximately 160 Australian and International Standards.
The National Construction Code is an initiative of the Council of Australian Governments (COAG) developed to
incorporate all on-site construction requirements into a single code. The NCC comprises the Building Code of
Australia (BCA), Volume One and Two; and the Plumbing Code of Australia (PCA), as Volume Three.
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Learning Activity 5.1 – Research Standards in the Building Industry I
This Activity may be completed in pairs.
1. Research and briefly explain the importance of Standards within the building industry.
2. Why do Standards exist?
You may use this space to take any notes:
Learning Activity 5.2 – Research Standards in the Building Industry II
This Activity may be completed in pairs.
1. Select 4 products that are used within the building sector. Research each and determine the relevant
building standard for each product.
You may use this space to take any notes:
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Learning Activity 5.3 – Research Standards in the Building Industry III
This Activity may be completed in pairs.
1. Conduct research on the Building Act 1993.
2. Think of a building project you’ve worked on, or one you could work on.
3. Identify three things from the Act you’d need to take into consideration in your work.
4. Based on your findings explain the importance of organisations adhering to the Builders Act 1993.
Why should the Act be followed?
You may use this space to take any notes:
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Learning Activity 5.4 – Building Code Australia
This Activity may be completed in pairs.
1. Research the Building Code Australia.
2. What is the goal of the code?
3. Based on your findings explain why this goal (and the code) exists.
You may use this space to take any notes:
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Learning Activity 5.5 – Penalties
This Activity may be completed in pairs.
1. Research and record the penalties for organisations not complying with the BCA on construction sites.
You may use this space to take any notes:
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SECTION 6: PLANNING AND SUSTAINABILITY
Acts relating to environmental sustainability vary state to state, so it is important to have a sound understanding
of your state’s Act and how it affects you.
6.1 IN VICTORIA
Planning and Environmental Act 1987
The purpose of the Planning and Environmental Act is to establish a framework for planning the use,
development and protection of land in Victoria.
Scope of the Act
The Act sets out procedures for preparing and amending the
Victoria Planning Provisions and planning schemes, obtaining
permits under schemes, settling disputes, enforcing
compliance with planning schemes, and other administrative
procedures. The main functions of the Act are to:
set the broad objectives for planning in Victoria
set the main rules and principles for how the
Victorian planning system works
set up the key planning procedures and statutory
instruments in the Victorian planning system
define the roles and responsibilities of the Minister, councils, government departments, the community
and other stakeholders in the planning system
The Act is 'enabling' legislation and does not precisely define the scope of planning, how it should be done or
the detailed rules that should apply to land use and development. These and other more detailed matters are
dealt with by subordinate instruments under the Act, such as the Victoria Planning Provisions, planning schemes,
regulations and Ministerial directions. The Planning and Environment Act 1987, the Planning and Environment
Regulations 2005 and the Planning and Environment (Fees) Regulations 2000 establish the legal framework for
the planning system in Victoria. The main parts of the planning system established by the Act include:
the system of planning schemes that sets out how land may be used and developed
the Victoria Planning Provisions that sets out the template for the construction and layout of planning
schemes
the procedures for preparing and amending the Victoria planning provisions and planning schemes
the procedures for settling disputes, enforcing compliance with planning schemes, and other
administrative procedures
What is ‘Res Code?’
Res Code is a set of planning scheme provisions that applies to residential developments across Victoria.
Res Code brings all the objectives and standards for housing together into two documents; the Planning Scheme
and the Building Regulations. Res Code applies to the construction or extension of one or more dwellings up to
and including three storeys in height (excluding a basement).
Environment
Environmental legislation particular to the construction industry is governed by the Environment Protection Act
1970. The purpose of this Act is to create a legislative framework for the protection of the environment in
Victoria having regard to the principles of environment protection. The Environment Protection Act 1970 was,
at its inception, only the second Act in the world to deal with the whole of the environment in a systematic and
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integrated way. The Act is outcome oriented, with a basic philosophy of preventing pollution and environmental
damage by setting environmental quality objectives and establishing programs to meet them. Over the years
the Act has evolved to keep pace with the world's best practice in environment protection regulation and to
meet the needs of the community.
Key aims of the Act include sustainable use and holistic management of the environment, ensuring consultative
processes are adopted so that community input is a key driver of environment protection goals and programs
and encouraging a co-operative approach to environmental protection
In terms of construction, the Environmental Protection Authority (EPA) is the watchdog for the commercial and
domestic building industry. The EPA will tend to devote their time working with large commercial builders,
whose practices could possibly impact the environment from pollution of land, air, and noise. The EPA will
impose fines on companies that breach the EPA Act, and quite often fines will range from thousands to hundreds
of thousand dollars.
Councils will usually deal with builders not managing their sites, not monitoring their rubbish on site, excessive
mud on roads and footpaths, and damage to roads and footpaths. Councils will also impose fines based on
excessive noise, storm water run-off, working outside of Council’s starting and finishing times, with builders
polluting the land and air, and excessive noise.
Sustainability
As from 1 May 2011, all new homes, home renovations, alterations and additions will need to comply with a 6
Star Standard under the Building Code of Australia. This aligns Victoria with national energy efficiency measures.
The 6 Star Standard applies to the thermal performance of a home, renovation or addition; plus the installation
of either a solar hot water system, or a rainwater tank for toilet flushing. Some simple building work that do not
require a Building Permit will not be affected by the new regulations. However all new homes and building
projects, including home extensions and major renovations, will need to comply with the 6 Star Standard.
A 6 Star energy efficiency rating applies to your home's building envelope - its roof, walls, floor and windows.
The 6 Star requirements include efficiency standards for lighting but not plug in appliances.
Meeting 6 Star Standard compliance is not difficult. It's about good design, particularly at the planning stages.
So talk to your building professional early to take advantage of the benefits, such as increased comfort, saving
money on energy bills, and making your home more resilient to the impacts of climate change. Carefully
selecting your site so your home's orientation takes advantage of solar energy can add up to 1 Star to the rating.
6 Star homes are projected to use 24 per cent less energy through heating and cooling compared to 5 Star
homes. This will see Victorians saving a further $100 off their energy bills each year. This is only an average
saving. Residents who use their energy features in their home wisely can save even more.
If you are intending to build, renovate or extend your home, or re-locate an existing home after 1 May 2011, the
design of your new home, extension or renovation will need to take account of the new 6 Star Standard. Your
building designer will be able to advise you on how to best achieve this.
To reduce the environmental impact of a building it is useful to be able to measure and quantify its performance
and compare different options. There is a wide range of rating schemes and assessment tools that measure
different aspects of building sustainability.
Rating tools provide assessment methods and benchmarks that can be used to set minimum regulatory
standards and can encourage better levels of practice that goes beyond those minimum standards. Some rating
tools help us to understand better how human behaviour affects a building’s environmental performance
The Building Code of Australia (BCA) provides an excellent example of how rating tools can help improve the
environmental performance of homes. In most areas of Australia the BCA now requires a minimum energy star
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rating for new single dwellings of 6 stars as assessed by the Nationwide House Energy Rating Scheme. While the
standard of 6 out of the 10 stars available is not best practice, the standard is considerably higher than the
average performance of homes built prior to the regulation.
6.2 IN NEW SOUTH WALES
Planning in NSW is largely governed by the following two pieces of legislation:
Environmental Planning and Assessment Act 1979 (or “the EP&A Act”) and the
Environmental Planning and Assessment Regulation 2000 (or “the EP&A Regulation”)
While the Act and the Regulation provide the overarching structure for planning in NSW, there are a number of
other statutory documents that support that structure. The two most commonly used are State Environmental
Planning Policies (SEPPs) and Local Environmental Plans (LEPs).
Each local government area has a LEP to guide development and protect natural resources such as waterways
and heritage within local government areas. LEPs are prepared by local Councils, in consultation with their
community and approved by the Minister for Planning (or their delegate).
Although the rules and guidelines for land use within local Council areas are dictated to some degree by State
Environmental Planning Policies, local Councils can administer more specific rules about land use through their
Local Environmental Plans, and can provide additional guidance in their development control plans (DCPs).
State Environmental Planning Policies (SEPPs)
State Environmental Planning Policies (SEPPs) deal with matters of State or regional environmental planning
significance. They are made by the Governor on the recommendation of the Minister for Planning and may be
exhibited in draft form for public comment before being published as a legal document. State Environmental
Planning Policy (SEPP) No. 65 aims to improve design quality of residential flat buildings of three or more storeys,
and containing four or more self-contained dwellings.
This Policy applies to:
the erection of a new residential flat building
the substantial redevelopment or the substantial refurbishment of an existing residential flat building
the conversion of an existing building to a residential flat building
The Policy recognises that the design quality of residential flat development is of significance for environmental
planning for the State due to the economic, environmental, cultural and social benefits of high quality design.
SEPP 65 aims to:
ensure that it contributes to the sustainable development of NSW
minimise the consumption of energy from non-renewable resources, to conserve the environment and
to reduce greenhouse gas emissions
achieve better built form and aesthetics of buildings and of the streetscapes and public spaces they
define
better satisfy the increasing demand, changing social and demographic profile of the community and
the needs of the widest range of people from childhood to old age, including those with disabilities
maximise amenity, safety and security for the benefit of occupants and the wider community
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Local Environmental Plans (LEPs)
Local Environmental Plans (LEPs) are an integral part of the NSW planning system. They are created by local
Councils in consultation with their community to control the form and location of new development, along with
protecting open space and environmentally sensitive areas.
LEPs guide planning decisions for local government areas. Through zoning and development controls, they allow
Councils and other consent authorities to manage the ways in which land is used. LEPs are the primary planning
tool to shape the future of communities and also govern and direct the estimated $29 billion worth of local
development that is determined each year.
Building approvals
Building approvals are overseen by the BCA Certifiers who
are accredited building certifiers. They also assist builders
to obtain the required approvals and act as the principal
certifying authority to ensure mandatory inspections are
carried out and issue the occupation certificate when the work is
completed.
Development consent
The development consent is obtained through local council. BCA
certifiers are generally not involved at this stage unless they need to ensure your building will comply with the
Building Code (BCA) in the first instance and therefore avoid cost and time delays when it comes to the
construction certificate. If the development consent approved building does not comply with the BCA and must
be changed to make it comply you might have to go back to the council to modify the Development Consent
(S.96 application) before the Construction Certificate can be issued.
Construction certificate
Whereas the DA is about what you can and cannot build on your land and from a planning perspective what
your building must include to get consent, the Construction Certificate is about how the building will be
constructed including structural and other BCA requirements. As well as a DA and CC, you must also appoint a
principal certifying authority (PCA) before you commence work. The PCA carries out mandatory and other
inspections during construction and issues the occupation certificate when the building or other structure is
completed.
Environment
The Protection of the Environment Operations Act 1997 (POEO
Act) establishes the NSW environmental regulatory framework
and includes a licensing requirement for certain activities. The
Environment Protection Authority (EPA) administers this Act and
works with Federal, State and local government to deliver
environmental outcomes in NSW. They enforce environmental
legislation and regulations and respond to emergencies and
pollution incidents. The legislation and polices that impact on the
building industry include:
Managing asbestos during resource recovery of
construction and demolition waste
Construction noise
Disposing of household building waste
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Sustainability
The Building Sustainability Index (BASIX) aims to deliver equitable, effective water and greenhouse gas
reductions across the state. BASIX is one of the strongest sustainable planning measures to be undertaken in
Australia. It is implemented under the Environmental Planning and Assessment Regulation 2000 (EP&A
Regulation) and State Environmental Planning Policy (Building Sustainability Index: BASIX) 2004 (the BASIX SEPP).
BASIX Certificate
You will require this certificate if you intend to submit a development application to a New South Wales local
Council to:
Construct a new residential dwelling (such as single house, dual occupancy, townhouse or multi-unit)
Alter, enlarge or extend buildings with more than one dwelling (other than hotels or motels)
Undertake a development for the purpose of building a large swimming pool or spa
BASIX encourages the reduction of energy use and greenhouse gas emissions through the following strategies:
Hot water systems – reducing the demand for hot water (by improving water efficiency) and meeting
the demand with less greenhouse-gas-intensive water heaters
Heating and cooling – reducing the heating and cooling demand (by improving thermal comfort
performance) and meeting the demand with less greenhouse-gas-intensive appropriate heating and
cooling systems
Ventilation and exhaust – using natural ventilation
where appropriate, and reducing the operation of
mechanical ventilation with suitable controls
Lighting – using direct natural lighting where
appropriate and energy-efficient lighting
Pools and spas – choosing less greenhouse-gas-
intensive water heating and pumping systems
Alternative energy sources – such as photovoltaics,
wind turbines and cogeneration
Other energy uses – choosing less greenhouse-gas-
intensive cooking facilities, refrigeration, clothes drying
and appliances (appliances are an option in multi-
dwellings only – not single dwellings)
Central systems (in multi dwellings only) – central hot water, central heating, central cooling, lifts,
saunas and other measures
A certificate is issued once a Building Sustainability Index (BASIX) assessment has been satisfactorily completed,
using the on-line tool.
6.3 IN QUEENSLAND
Sustainable Planning Act
The Sustainable Planning Act 2009 seeks to achieve sustainable planning outcomes through:
Managing the process by which development takes place
Managing the effects of development on the environment
Continuing the coordination and integration of local, regional and state planning
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Building approvals
You may be required to obtain a Development Approval (DA) from council in accordance with the Sustainable
Planning Act 2009. This is predominantly an approval for assessment against the respective Town Planning
Schemes from your Local Government area.
Once the DA is in place you can be issued with a Building Development Approval (BA) to authorise the
commencement of your building work. The DA is obtained through a Town Planning Application to your
respective Local Government. After obtaining DA you need to obtain a BA and must appoint a Queensland
Licensed Certifier. As opposed to the DA, which gives approval as to what you can build from a town planning
perspective, the BA is an approval for how the building will be constructed ensuring compliance with the codes,
standards and applicable building control legislation.
Environment
The key piece of environmental legislation in Queensland is the Environmental
Protection Act 1994 (EP Act).
The EP Act protects the environment with a focus on ecologically sustainable
development. It creates a general duty for all people, companies and government
bodies to take all reasonable and practicable steps to avoid harm to the
environment. Under the EP Act, it’s an offence to cause harm to the environment.
It’s also an offence to not notify authorities if you’re doing an activity and become
aware that it’s causing environmental harm.
Sustainability
The requirements for sustainable buildings in QLD are part of the Queensland
Development Code (4.1).
It particularly focuses on new houses and townhouses (class 1 buildings) and multi-unit residential buildings
(class 2) with regard to:
6-star energy equivalence for houses and townhouses
5-star energy rating for multi-unit residential buildings
optional credits for outdoor living areas, such as decks, verandas and balconies
optional credit for photovoltaic (solar) energy systems
energy efficient lighting
water conservation
energy efficient air conditioners
It also provides information on how these provisions apply to alterations or additions to existing dwellings, such
as extensions, renovations or relocations.
Cleaner Greener Buildings
Cleaner Green Buildings is a Queensland Government initiative that lifts the environmental standards for all new
homes, offices and government buildings. ClimateQ, the Government's overarching sustainability policy,
allocates $450,000 in measures and activities to help achieve the higher environmental standards.
The following are the key government actions under Cleaner Greener Buildings:
require that by the end of 2010, new houses and major renovations must meet a 6-star (out of 10)
residential energy equivalence rating by the end of 2010, with up to one star achieved through the
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inclusion of an outdoor living area. And from 1 March 2010, new units will be expected to meet a 5-star
(out of 10) residential energy equivalence rating
stop body corporates and developers from banning energy efficient building materials like lighter roofs
and solar hot water systems by amending the Body Corporate and Community Management Act 1997
require electricity sub-metering in new office buildings and multi-unit dwellings, giving tenants an
incentive for the first time to reduce their own power bills and in turn reduce greenhouse gas emissions
require end of trip facilities for cyclists (including racks, lockers and showers) in all new major
developments around key activity centres and in new commercial buildings greater than 2000m2
The Cleaner Greener Buildings initiative is supported by the Building Code of Australia and the Queensland
Development Code, which consolidates Queensland-specific building standards into a single document. The
code covers Queensland matters outside the scope of, and in addition to, the Building Code of Australia. Parts
of the code, such as 4.1 - Sustainable Buildings, have requirements relating to energy efficiency and
sustainability.
6.4 GREEN STAR
Green Star is a national, voluntary rating system for buildings and communities which has been administered by
the Green Building Council of Australia since 2003. There are four rating tools for Green Star accreditation:
Design and as built – this guides the sustainable design and construction of a range of schools, offices,
industrial facilities, public buildings, retail centres and hospitals
Interiors – transforming the interiors of everything from offices and hotels to shops and schools
Communities – improving the sustainability of projects at the neighbourhood precinct or community
scale
Performance – supporting higher levels of operations efficiency within existing buildings
More information on Green Star accreditation can be found on the Green Buildings of Australia website.
Summary
Victoria
Planning legislation is governed by the Planning and Environment Act 1987. Res Code is a set of planning
scheme provisions that applies to residential developments across Victoria. The Environmental Protection
Authority (EPA) is the watchdog for the commercial and domestic building industry. New homes, home
renovations, alterations and additions need to comply with a 6 Star Standard under the Building Code of
Australia.
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New South Wales
Planning legislation is governed by the Environmental Planning and Assessment Act 1979. The Environmental
Protection Authority (EPA) is the watchdog for the commercial and domestic building industry. New homes,
home renovations, alterations and additions need to comply with the BASIX Standard.
Queensland
Planning legislation is governed by The Sustainable Planning Act 2009 which seeks to achieve sustainable
planning outcomes through:
Managing the process by which development takes place
Managing the effects of development on the environment
Continuing the coordination and integration of local, regional and state planning
The requirements for sustainable buildings in QLD are part of the Queensland Development Code (4.1)
Cleaner Green Buildings is a Queensland Government initiative that lifts the environmental standards for all new
homes, offices and government buildings. Green Star is a national, voluntary rating system for buildings and
communities.
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Learning Activity 6.1 – 6 Star Rating
This Activity may be completed in pairs.
1. Research the 6 star rating and briefly explain in your own words what this is.
2. List the 3 factors that must be included (in the plans for a new building) to meet the 6 star rating.
You may use this space to take any notes:
Learning Activity 6.2 – Planning and Sustainability
This Activity may be completed in pairs.
1. Conduct research on your local council to identify the following:
a. Environmental requirements that apply to domestic builders.
b. Fines that apply when council by-laws are breached.
You may use this space to take any notes:
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Learning Activity 6.3 – Council Approval
This Activity may be completed in pairs.
1. You have been asked to build a double story townhouse located in the inner city of Melbourne.
2. Research to identify what requirements must be met for council to approve your building permit
application. List them below.
You may use this space to take any notes:
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SECTION 7: CONTRACT LAW AND COMMON LAW PRINCIPLES
Contract law is a very important branch of the law for people working in the building and construction industry.
The vast majority of the contracts pose no problems - they are usually a simple exchange of cash for goods. But
when they get more complicated they can, and do, go wrong. This is less
likely to occur when the parties involved in the contract understand what
they are doing, what their rights and obligations are, and how to recognise
potential problems. The purpose of this section is to give you an outline, in
simple terms, of contract law and to help you to understand when you
need to get professional help. It is intended to give you a basic
understanding of what is needed to form a legally binding contract.
Common law, also known as case law or precedent, is law developed by
judges through decisions of courts and similar tribunals, rather than
through legislative statutes or executive branch actions of Government. A
‘common law system’ is a legal system that gives great precedential weight to established common law.
7.1 IN VICTORIA
Consumer Affairs Victoria
Victoria’s consumer affairs regulator is called Consumer Affairs Victoria. Its purpose is to help Victorians be
responsible and inform traders and consumers. To do this, Consumer
Affairs Victoria:
Reviews and advises the state government on consumer
legislation and industry codes
Advises and educates consumers, tenants, traders and
landlords on their rights, responsibilities and changes to the
law
Registers and licenses businesses and occupations
Conciliates disputes between consumers and traders, and tenants and landlords
Enforces and ensures compliance with consumer laws
Scope
The impact of the work is far-reaching. Consumer Affairs advise and assist on topics including renting and
accommodation, estate agents, building, shopping and trading. It also licenses or registers and regulates estate
agents, introduction agents, motor car traders, travel agents, second-hand dealers and pawnbrokers.
Goals
The goals of Consumer Affairs Victoria are to:
Empower consumers
Create a competitive, fair and safe trading environment
Protect vulnerable and disadvantaged consumers
Build organisational capability
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7.2 IN NEW SOUTH WALES
NSW Fair Trading
The consumer affairs regulator is NSW Fair Trading. Its purpose is to safeguard the rights of all consumers and
advises business and traders on fair and ethical practice. It is a division of the NSW Office of Finance and
Services (OFS) whose role is to make doing business in NSW
simple, accessible and fair for employees, consumers and
industry while providing best value for government.
Their role is to:
provide services directly to individuals and businesses to
create a fair, safe and equitable marketplace
administer laws which set the rules for fairness in the
transactions between consumers and traders
investigate unfair practices and ensure that the
products sold in NSW are safe and meet their
regulations and safety standards
register co-operatives and associations, and issue occupational licences so consumers can trust the
people they are dealing with
They administer the Australian Consumer Law 2011 (ACL) which includes:
a national unfair contract terms law covering standard form consumer contracts
a national law guaranteeing consumer rights when buying goods and services
a national product safety law and enforcement system
a national law for unsolicited consumer agreements covering door-to-door sales and telephone sales
simple national rules for lay-by agreements
new penalties, enforcement powers and consumer redress options
7.3 IN QUEENSLAND
Consumer Affairs QLD
The consumer affair s regulator in QLD is the Queensland Office of
Fair Trading. Their role is to:
deal with consumer rights, complaints and scams
provide advice to business
regulate licensed industries
provide advice to charities, associations and not-for-
profits
provide general fair trading services and resources
They administer the Australian Consumer Law 2011 (ACL) which includes:
a national unfair contract terms law covering standard form consumer contracts
a national law guaranteeing consumer rights when buying goods and services
a national product safety law and enforcement system
a national law for unsolicited consumer agreements covering door-to-door sales and telephone sales
new penalties, enforcement powers and consumer redress options
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7.4 COPYRIGHT
Copyright is a set of exclusive rights granted to the author or creator of an original work, including the right to
copy, distribute and adapt the work. Copyright does not protect ideas; only their expression. In most jurisdictions
copyright arises upon fixation and does not need to be registered.
Copyright owners have the exclusive statutory right to exercise control over copying and other exploitation of
the works for a specific period of time, after which the work is said to enter the public domain. Uses covered
under limitations and exceptions to copyright such as fair use do not require permission from the copyright
owner. All other uses require permission. Copyright owners can license or permanently transfer or assign their
exclusive rights to others.
Initially, copyright law applied to only the copying of books. Over time other uses
such as translations and derivative works were made subject to copyright. Copyright
now covers a wide range of works, including maps, sheet music, and dramatic works,
and paintings, photographs, architectural drawings sound recordings, motion
pictures and computer programs
Under the Copyright Act of 1968 building designs cannot be copied or used in any
way without the owner's consent. Material that is protected by the Copyright Act includes drawings, sketches
and plans of houses. It is not necessary to register the documents; copyright protection is automatic.
The rule is ‘do not use other’s designs to construct’. You can be sued and the damages can be expensive. Search
out the source of the plans you are using until you are completely satisfied that the designs are originals and
your use of them will not infringe copyright.
Summary
Common law, also known as case law or precedent, is law developed by judges through decisions of courts and
similar tribunals, rather than through legislative statutes or executive branch actions of Government.
Copyright is a set of exclusive rights granted to the author or creator of an original work, including the right to
copy, distribute and adapt the work.
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Learning Activity 7.1 – Contract Law I
This Activity may be completed in pairs.
1. You have received a detailed complaint from Kelly via email. Kelly’s email details that the wrong brick
has been used to build the façade of her house. She specifically requested the upgrade CAT 8 brick for
the façade and the CAT 1 brick for the remainder of the house. The ‘brickie’ has used CAT 1
throughout.
2. Detail your approach to solving this issue. How would you respond to Kelly? Write an email response
below.
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Learning Activity 7.2 – Contract Law II
This Activity may be completed in pairs.
1. John a new client is hoping to get his family home built by your company. He purchased the block of
land from the local land developer and it is due to settle soon, ready for the building process.
Originally he was quoted (from your sales consultant) 18K for an M class slab with site costs included.
However, after receiving the soil test results it has been revealed the requirements of the site are
considerably different. The block requires 18 screw piles and a H2 slab costing 30K with site costs.
John is refusing to sign the contracts and is extremely angry.
2. Detail how you will approach solving this problem. How would you respond to John? Write an email
response below.
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SECTION 8: FINANCIAL TRANSACTIONS
In Australia, pay-as-you-go withholding arrangements replaced pay-as-you-earn arrangements when a new tax
system was introduced in July 2000. The new arrangements did not confine themselves to employment
arrangements; they also replaced the Prescribed Payments System and the Reportable Payments System.
‘Pay as you go’ (PAYG) is the Australian taxation system for withholding taxation from employees and other
payee’s regular payments from employers and other payers. It is also
used to deduct such things as superannuation contributions, Higher
Education Loan Programme (HELP) repayments, and Medicare
payments. The system estimates an annual income on the basis of a
weekly or fortnightly payment. The appropriate level of taxes and
payments are then withheld and passed on to the Australian Taxation
Office (ATO). For employees with only a single job, the level of
taxation at the end of the year is close to the amount due, before deductions are applied.
Discrepancies and deduction amounts are declared in the annual income tax return and will be part of the refund
which follows after annual assessment, or alternatively, reduce the taxation debt that may be payable after
assessment. For an employee's primary job, the withholding tax rate is lower because of the existence of a tax-
free threshold in Australia. All other work has tax withheld based on a rate that excludes the tax-free threshold.
8.1 PAYSLIP RECORDS
Australian workers are entitled to receive a statement of earnings for each pay period in the form of a payslip.
A payslip provides employees with a convenient summary of earnings for each pay period and can also detail
information such as leave and Rostered Day Off entitlements. Payroll administration, including the production
of pay slips, is a detailed and time consuming task. State and federal legislation generally require that the
following details are included on a payslip:
Employer’s name
Employee's name
Employee's classification or award
Pay Period relating to the payment
Pay Date
Gross amounts including details of overtime and allowances
Amount of PAYG deducted
Deductions, including employee contributions for superannuation
Net amount paid
8.2 PAYROLL REQUIREMENTS
Payroll Tax generally refers to two different kinds of similar taxes. The first kind is income tax that employers are
required to withhold from employees' wages. This may also be referred to pay-as-you-earn tax (PAYE), or pay-
as-you-go tax (PAYG). The second kind is a tax that is paid from the employer's own
funds and that is directly related to employing a worker. It can consist of a fixed
charge or be proportionally linked to an employee's pay. This tax is known as Payroll
Tax. If you are in charge of organising payroll paperwork for staff, ensure you’re up-
to-date on the current legislation of you State or territory.
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8.3 SUPERANNUATION (‘SUPER’) CONTRIBUTIONS
A super contribution is a payment made to a Superannuation Fund or Retirement Savings Account (RSA) to
provide benefits for individuals on their retirement or, on their death, to their dependants. Super contributions
do not include amounts of money earned by super funds or RSA’s from any income, profits or gains earned from
the capital of the fund or RSA and credited to members’ accounts.
How are Super contributions made?
Super contributions are made in a number of ways including:
Those made by a contributor on behalf of someone else (for example, an employer making a
contribution for an employee, or a person making a contribution for their spouse, child or friend)
Those made by the contributor for their own benefit
A rollover or transfer of benefits between Australian super funds
Amounts transferred from a foreign super fund to an Australian super fund
Those that the Tax Commissioner is required to make (for example, the super co-contribution for low-
income earners)
8.4 GOODS AND SERVICES TAX (GST)
The Goods and Services Tax (GST) in Australia is a value added tax on the supply of goods and services in
Australia. It was introduced by the Federal Government with the ‘A New Tax System (Goods and Services Tax)
Act 1999’. It took effect from July 1 2000. The basic premise of the new tax was to broaden the tax base.
Prior to the GST, Australia operated a Wholesale Sales Tax (WST) which imposed a tax on the wholesales of
goods. The WST was implemented in the 1930′s when
Australia had an economy dominated by goods. Over the
years however, Australia’s economy evolved to be more
services based, and the GST served to strip away the unfair
tax advantage that service providing businesses had over
suppliers of goods businesses.
The GST is levied at a flat rate of 10% on goods and services
except GST exempt items and input taxed goods and
services. Where you are registered or required to be
registered for GST, you must pay GST on your taxable sales. You can generally claim GST credits for the GST
included in the price of goods and services that you purchase. You then calculate the GST you are liable to pay,
and the GST credits you are eligible to claim, when you lodge your Business Activity Statement (BAS) at the end
of each tax period. The tax period in which you account for GST will depend on whether you account for GST on
a cash or non-cash (accruals) basis. You can only use one accounting basis. You are eligible to account for GST
on a cash basis if you meet any of the following criteria:
You are a small business with an annual turnover (including the turnover of your related entities of less
than $2 million
You are not operating a business, but are carrying on an enterprise with a GST turnover of less than $2
million
You account for income tax on a cash basis
You carry on a kind of enterprise the ATO has determined is able to account for GST on a cash basis
regardless of your GST turnover
You are an endorsed charitable institution, trustee of an endorsed charitable fund, gift deductible entity
or government school, regardless of your GST turnover
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How Do I Account For GST On A Cash Basis?
If you are eligible and account for GST on a cash basis, you will:
Account for the GST payable on your sales in the tax period in which you receive payment for them. If
you receive only part payment for a sale in a tax period, you account only for the part of the GST
payment that relates to that part of the sale in that tax period
Claim GST credits for your business purchases in the tax period in which you pay for them. If you pay
only part of the cost of a business purchase in a tax period and have a valid tax invoice, you claim only
the GST credit for that part of the cost in that tax period
Claiming the GST
You can claim the GST back when you lodge your Business Activity Statement (BAS). The exact period you claim
it will depend on whether you account for GST on a cash or accruals basis. If your turnover is less than $2,000,000
and you are a small business entity, you may elect to lodge your BAS either monthly, quarterly, or annually. If
you lodge your BAS annually, you will have to wait up to a year to claim your GST back. If your turnover is more
than $2,000,000 you must lodge your BAS monthly.
Calculating GST payable
GST is payable if you make a taxable supply. GST is calculated as 10% of the value of the supply. The value of a
taxable supply is the GST-exclusive consideration payable for the supply. For example, if the value of the supply
is $70 the GST payable is 10% x $70 = $7. The price (the GST-inclusive consideration payable for the supply) is
therefore $77. If the price for the supply is $77 you can work out the GST component of the price as follows:
$77 ÷ 11 = $7.
8.5 WHAT IS A TAX INVOICE?
An invoice is a notice of an obligation to pay. A tax invoice is a document
that substantiates a creditable acquisition. A tax invoice must contain
certain information that may not otherwise appear on an ordinary
invoice. You can issue a tax invoice in addition to an ordinary invoice, or
you may choose to forego issuing ordinary invoices and only issue tax
invoices. In most cases a normal receipt for a supply can easily be adapted
to become a tax invoice.
When is a tax invoice issued?
Tax invoices are generally issued by the supplier. If a tax invoice is not
issued by the supplier, the recipient may request one and the supplier
must issue an invoice for all taxable supplies with a GST exclusive value
of $50 or more within 28 days of the request.
Contents of a Tax Invoice
Tax invoices for a taxable supply must:
Be issued by the supplier, unless it is a recipient created tax invoice (in which case it must be issued by
the recipient)
Show the Australian Business Number (ABN) of the entity issuing it
Show the price for the supply
Contain such information as the regulations require
Be in the form approved by the commissioner
Display the words "TAX INVOICE" in a prominent place on the front page of the tax invoice
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Show the name and trading name of the supplier
Show the name and address of the recipient
Show the date of issue of the tax invoice
Provide a brief description of what was supplied
State the quantity or volume of what was supplied e.g. Hours of labour, number of items
8.6 MANAGING YOUR PAPERWORK
The Rules of ‘Deskmanship’
To overcome drowning in a sea of paperwork, there are three golden rules of deskmanship:
Rule 1: Aim for a clear desk
Rule 2: Handle every piece of paper only once, moving incoming correspondence immediately to its
next destination
Rule 3: Have a regular clear out of files
You can also observe the following rules:
Always stop and ask if a piece of paper is really necessary
Send replies to people on the paper they sent you
Phone instead of write
Only use paper if it is vital to record something
Wean yourself off junk-mail
Control the amount of photocopying you need
Here are three things you can do to keep your paperwork under control:
1. Mark It.
Simply put a small mark on the top right-hand corner every time you handle a piece of paper that is lying around
without a proper place. After about 20 aimless marks, guilt should kick in and force you to do something about
it.
2. Sort It.
Don't dither. Make up your mind to do one of 5 things with your piece of paper:
Bin it
File it
Store it as a record
Send it to someone for action
Do whatever you must to end its presence
3. Store It.
Stored paperwork needs 3 simple systems: a colour-coding system to make it easier to find; an out-take system
to keep track of it if it is removed; and a bring-forward system for actioning it. Taking time to develop these
systems will save you time in the long run.
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Filing systems
Here are 7 simple things you can do to improve your filing system:
1. Try filing your documents into file folders, and then put them into hanging file folders. This will prevent
clutter, but don't put too many file folders in the hanging file folder, since it could break over time. If
you really do have to put a lot of files in a folder, place a rubber band
around the folder.
2. Place your most current files in the front of each file folder, for easier
access. This will also help you find information faster and help you be
more organized.
3. Try using colour tabs or colour file folders for your different file
categories.
4. Make sure you file your file folders in alphabetical/chronological
order, depending on what works for you.
5. If your filing cabinet gets too full, take out the oldest files and store
them in a box or archive them off site (if you have this option). Make
sure to label the box very clearly, so that when you need to go back
to it, you can do so with ease.
6. Put labels on your filing cabinet drawers, for easier access to information that you will be looking for.
You don't want to spend time trying to figure out where you filed certain files.
7. If you really want to get creative, you can put plastic tabs on the hanging file folders, with details of
each section. You can even colour code them, depending on categories.
Summary
PAYG is the Australian taxation system for withholding taxation from employees and other payee’s regular
payments from employers and other payers. Australian workers are entitled to receive a statement of earnings
for each pay period in the form of a payslip.
A super contribution is a payment made to a Superannuation Fund or Retirement Savings Account (RSA) to
provide benefits for individuals on their retirement or, on their death, to their dependants. The GST is levied at
a flat rate of 10% on goods and services except GST exempt items and input taxed goods and services.
The tax period in which you account for GST will depend on whether you account for GST on a cash or non-cash
(accruals) basis. You can only use one accounting basis. You can claim the GST back when you lodge your Business
Activity Statement (BAS).
A tax invoice is required for an entity to claim an input tax credit on a creditable acquisition. An invoice is a notice
of an obligation to pay. Tax invoices are generally issued by the supplier.
Aim for a clear desk
Handle every piece of paper only once, moving incoming correspondence immediately to its next
destination
Have a regular clear out of files
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Learning Activity 8.1 – Calculating GST
This Activity may be completed in pairs.
1. How would you calculate GST payable and when is this calculation needed?
You may use this space to take any notes:
Learning Activity 8.2 – Superannuation
This Activity may be completed in pairs.
1. Investigate Superannuation in Australia.
2. What is it and why does it exist? Briefly explain below.
3. What is the Superannuation Guarantee?
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SECTION 9: CONTRACTS
9.1 WHAT IS A CONTRACT?
A contract is an agreement at law between two or more parties than can be enforced by the courts and the legal
system.
In general, contracting parties are free to include any terms they like into the contract, on the proviso that they
do not attempt to contract above the law. State and Territory governments have enacted laws and regulation
relating to home residential contracts to which adherence is mandatory.
Within a building contract, each party agrees to do something for the other party. A simple view of a standard
home building contract is one in which the builder agrees to build the house and the owner agrees to pay the
builder a mutually-determined sum for his work.
= A legally binding contract
Essential contract terms
An overview of the essential concepts necessarily involved in the creation of a valid contract is provided in the
table below. These terms will be further discussed in later in this resource.
OFFER
An ‘offer’ is an expression of willingness to contract on the terms stated. It is judged objectively by the
courts – relative to the perspective of a hypothetical ‘reasonable person’.
The list below describes the main rules relating to offer (these do not exhaust all of the situations in which
an offer can be made):
An offer must be distinguished from an ‘invitation to treat’. The terms and conditions concerning
the offer – and details of what is being offered - must be clear and understandable; the clarity and
exactness of an offer is opposed to an invitation to treat, which is general in nature
An offer can be made to a specific person, persons, class of persons, or to the whole world. An
offer can be specific to a certain class of the public in order to intentionally narrow its scope; this
would be done so that the offer would not be seen as an invitation to treat
An offer must be communicated so that it can be accepted, rejected, or a new offer made
An offer can be revoked at any time before acceptance.
ACCEPTANCE
‘Acceptance’ is an unqualified agreement - on the part of the party to whom the offer is made - to be
bound to the terms offered. Acceptance can be communicated to the party who made the offer, or may
be inferred through the conduct of an accepting party (namely, if that conduct corresponds to the contract
terms).
Intention to create legal
relations
An offer
Acceptance of the
offer
Consideration
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Acceptance of an offer by the other party gives rise to a binding contract, under which both parties become
subject to – and must satisfy - all its elements. For example:
A principal/owner invites builders (tenderers) to submit a tender (quotation). The builder‘s tender, once
submitted and communicated to the owner, is an offer. The owner is then free to decline or accept the
offer.
The list below describes the main rules relating to offer (these do not exhaust all of the situations in which
an offer can be made):
Acceptance must be in reliance on the offer (that is, there must be an offer in order for it to be
accepted, and the acceptance must be acceptance of that offer)
Acceptance must be complete and unqualified
Conditional assent is not acceptance. If the acceptor decides to accept an offer only with the
imposition of certain conditions, this is considered to be a new (counter) offer, and so acceptance
of the previous offer has not been achieved (this is because the conditions are essentially new
terms which are being introduced into the offer)
Acceptance must be clear and certain, with both parties agreeing on the exact terms of their
contract
Acceptance may be expressed or implied
Acceptance may be retrospective
A counter-offer is a rejection of an offer
Acceptance must be communicated to the party making the offer
The offer may prescribe methods of acceptance.
CONSIDERATION
‘Consideration’ is when the parties exchange something in return for the promises as stipulated in the
contract. Consideration is often monetary (financial). However, it can also take non-monetary forms, as
long as these are specified and acknowledged by the parties exchanging something of value; for example,
agreeing to tutor a plumber’s child in English as payment for fixing a sink.
Suppose that a client agrees to pay you (the contractor) $1,600 to repair their driveway. The agreement
to pay the $1,600 is the "consideration" (what the client gives up to get what you promised). This ensures
that the contract is enforceable.
INTENTION TO CREATE LEGAL RELATIONS
The intention to create legal relations (that is, be legally bound to do/not do something) can be determined
by using the following criteria:
What the parties said to each other before entering into the agreement
The nature of the agreement - was it social/family or business/commercial? (in commercial
transactions, there is always a presumption that the parties intended their agreement to be
binding).
The importance of the substance of the agreement to each party
Any other factors which would assist a court to determine what the parties had in mind when
they entered into the agreement
Custom and practice.
If it can be determined that one party did not intend that their agreement was to be legally binding, the
contract is then unenforceable by both parties.
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Letters of intent are common in the building industry. These are sent to a successful tenderer prior to the
formal execution of contract documents in order to indicate that a contract will follow.
FORMALITIES
While contracts can be formed without formality, some transactions are thought to require formal
processes; this is either because formal procedures tend to make people think carefully before binding
themselves to an agreement, or merely because it serves as clear evidence of the intention to create legal
relations.
CERTAINTY
A contract‘s essential terms must be sufficiently certain/clear, and not vague or uncertain.
CAPACITY
An enforceable contract requires that both parties have ‘legal capacity’ to enter into the contract. For
example, people who do not have legal capacity to enter into a contract include minors, incarcerated
persons, mentally handicapped persons, or individuals who are under the influence of illegal substances.
LEGALITY
A contract whose purpose is illegal or is against public policy will be invalid.
Effective communication
A key aspect of the tenderer’s role is to communicate effectively. Effective communication will need to
accommodate for a variety of language-literacies or dialects, utilising
concepts appropriate to cultural differences. This will apply whenever you
deal with suppliers, subcontractors, and clients in particular.
You should be aware of the different forms of nonverbal communication
that you are likely to encounter during contract negotiations. Skill in
interpreting nonverbal communication will help you collect useful
information from others involved in the negotiation, and may prevent you
from harming your own negotiating position by inadvertently sending
nonverbal signals that disclose confidential information or weaknesses in
your position.
Maintaining effective communication ensures that:
All stakeholders are informed at all times, avoiding confusion
The needs of the client or customer are met
Mistakes, issues, or discrepancies are highlighted and resolved efficiently
Relationships of mutual trust and respect between builder and client can be established and nurtured
All parties are comfortable to raise their concerns as necessary
Cultural differences
When dealing with cultural differences, there are a few key points that will assist you in communicating
effectively:
Avoid local and colloquial language
Use simple, plain English in written and verbal communication
Use written communication where practicable, even as a follow-up to provide clarity to verbal
discussions
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Avoid references to any particular race, religion, or cultural stereotyping in any communication
Use symbols and diagrams where possible as tools to reinforce/ensure understanding.
Be aware of cultural events as work may not be undertaken in these periods and may have a negative
impact on timelines
Body language
When deciding upon issues that will affect other people, it is best to discuss the issues with any relevant parties
to decide what will work best for all involved (within the bounds of reason and practicality). In face to face
dealings with others, be aware of your body language, and how this can be ‘read’/interpreted by others. Body
language may seem impossibly subtle, at times, but it can often be more obvious in its intention (and important
to interpret accurately) than you think. Here are some examples of body language which may be perceived as
either ‘negative’ or positive’ to another person:
Positive body language
Making eye contact
Smiling
Shaking hands (if culturally appropriate; it’s best to ask if you’re
unsure)
Nodding
Facing forwards/facing the client
Negative body language
Crossing arms
Looking away
Turning away
Performing another task while speaking
Frowning
Shaking your head
9.2 UNDERSTANDING LEGAL RESPONSIBILITIES
A builder has a number of responsibilities established by both law and building and
construction industry regulators. The builder, in their capacity as a professional
advisor, has a legal responsibility and duty of care for all aspects of the work they
perform, including responsibilities related to the construction contract. They must
also ensure that their advice is not biased, and that they behave responsibly on the
client’s behalf. The code of the profession requires that a duty of care be held to the
client.
Tort law
A tort is a civil wrong (as opposed to a criminal wrong). An action in tort is bought by the person who has been
wronged against, and is remedial (that is, the action is meant to compensate the person wronged for the
negative consequences of the wrong). The most common tort is the tort of negligence; in the context of the
building and construction industry, ‘negligence’ refers to the failure of a professional person to use the care or
skill that a reasonable person endowed with professional knowledge/expertise (and thus who owes a relevant
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duty of care when acting in professional capacity) would use in the normal course of events. Negligence does
not require intent to harm/wrong on the part of the person who commits the act.
Contract law
A contract is an agreement which parties intend to be legally binding. For a contract to exist, one of two parties
must offer to enter into a contract on certain terms. The other party must accept this offer. For a contract to be
enforceable, there needs to be some form of consideration. For example, the promise to pay is consideration
for the builder‘s promise to construct.
A lawfully binding contract, therefore, is composed of three elements:
Offer
Acceptance
Consideration
DEFINITION OF CONTRACT
(taken from Domestic Building Contracts act 1995 (Vic), S 3)
“Domestic building contract” means a contract to carry out, or to arrange or manage the carrying out
of, domestic building work other than a contract between a builder and a sub-contractor.
“Major domestic building contract” means a domestic building contract in which the contract price for
the carrying out of domestic building work is more than $5000 (or any higher amount fixed by the
regulations).
BUILDING WORK TO WHICH THIS ACT APPLIES
This Act (Domestic Building Contracts Act 1995 (Vic) S 5) applies to the following work:
(a) The erection or construction of a home, including
(i) Any associated work including, but not limited to, landscaping, paving and
the erection or construction of any building or fixture associated with the
home (such as retaining structures, driveways, fencing, garages, carports,
workshops, swimming pools or spas); and
(ii) The provision of lighting, heating, ventilation, air conditioning, water supply,
sewerage or drainage to the home or the property on which the home is, or
is to be;
(b) The renovation, alteration, extension, improvement or repair of a home;
(c) Any work such as landscaping, paving or the erection or construction of retaining structures,
driveways, fencing, garages, workshops, swimming pools or spas that is to be carried out in
conjunction with the renovation, alteration, extension, improvement or repair of a home;
(d) The demolition or removal of a home
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Consumer protection law
Welfare-state contract law (that is, common/judge-made law) has increasingly been supplemented by statute
law (that is, legislation made by Parliament). Important pieces of legislation that are relevant to construction
contracts include:
Competition and Consumer Act 2010 (formerly the Trade Practices Act 1974)
Copyright Act 1968
Corporations Act 2001
Income Tax Assessment Act 1997
Work Health and Safety Act 2011
Building Code of Australia
Australian Industrial Relations legislation
Development law governing land usage and construction
Workers‘ compensation legislation
Welfare legislation
Equal opportunity and disability discrimination legislation.
State/Territory Acts and Registration
Each State and Territory has unique consumer protection legislation which regulates building and construction
work. This legislation regulates who can operate as a builder, and provides a level of protection for consumers
by dictating what a building contract must -and cannot - include.
The legislation was established to protect the public interest. The main arguments for this legislation are that
the public requires protection from those not qualified to practice building, and that registration of practitioners
maintains high standards in the built environment. These arguments are sound, justifying both the field of
consumer protection legislation generally as well as any further, future improvements/additions to the current
body of legislation.
The relevant State or Territory Acts are as follows:
Australian Capital Territory – Building Act 2004
New South Wales – The Home Building Amendment Act 2014
Northern Territory – Building Act
Queensland – Domestic Building Contracts Act 2000 (in late 2014, the Queensland Government
approved the Queensland Building and Construction Commission and Other Legislation Bill 2014 (Bill).
This will repeal the Domestic Building Contracts Act 2000 and replace it with new provisions in the
Queensland Building and Construction Commission Act 1994)
South Australia – Building Work Contractors Act 1995
Tasmania – Building Act 2000
Victoria – Domestic Building Contracts Act 1995
Western Australia – Home Building Contracts Act 1991
Cooling off period
Most State/Territory legislation allows a consumer to exercise a ‘cooling off’ period, provided that they act
within a prescribed time. This allows the consumer to lawfully cancel a building contract without reason. The
client (owner) has five business days after receiving a signed copy of the building contract to change their mind
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(Domestic Building Contracts Act 1995 (Vic), s 34-35). It starts from the date the client received the signed copy,
regardless of when they signed the contract.
If the contract did not include the cooling-off period notices required by law (except in Western Australia, where
the law does not require that residential contracts contain a cooling-off period), the client has seven days after
realising that the contract should have included the cooling-off notice to withdraw.
To cool off, the client must put their decision to withdraw from the contract in writing. The law sets out how
they must deliver this to the builder. They must either:
Give it to the builder
Leave it at the builder‘s address as stated in the contract, or
Serve it on the builder in the way stated in the contract
The builder can keep $100 and the cost of out-of-pocket expenses incurred and approved by the client before
they withdrew. The builder must refund all other money. If the client ‘cools off’, they are not liable to the builder
in any way for withdrawing from the contract.
The client does not get a cooling-off period if they:
Previously entered into a major domestic building contract with you on the same terms for the same
home or land (the contract can differ slightly but not significantly), or
Engaged a lawyer to check the contract before they signed
The people involved
A construction contract typically involves two parties: the proprietor (principal/owner) and the builder
(contractor/head contractor).
Some contracts allow for a third entity to act as the contract administrator, although this party is not privy to
the construction contract. Contracts typically refer to the contract administrator as the ‘architect’, ‘engineer’, or
‘superintendent’. The contract administrator acts as both the owner‘s agent (e.g. the architect/engineer or other
nominated person) and an independent certifier in carrying out the contract administration. In this latter role,
the law requires that the contract administrator acts impartially, determining/clarifying the requirements of the
contract and ensuring, as far as they’re able, that both parties meet these requirements without dispute.
Generally, the builder subcontracts part of the works to various trades (subcontractors), all the while remaining
legally responsible for their performance. The proprietor is not a party to the arrangements with the
subcontractors; only the builder is. The proprietor - depending on the nature, complexity, and method of
delivery of the project - may also have numerous contracts of engagement with various consultants, such as:
Designers (architects, engineers or building designers)
Quantity surveyors
Project managers
Construction managers
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9.3 TYPES OF CONSTRUCTION CONTRACTS
There are various types of construction contracts, and each form of contract has its advantages and
disadvantages depending on the construction work involved. For example, if the project works are very well
defined, then the total cost of the project can be reasonably accurately
identified. This differs from a construction project for which an accurate
estimate of the quantities involved is difficult. A schedule of rates (i.e.,
a dollar value per unit of identified work) is a more realistic proposition
for the parties involved, in this instance.
It should be noted that, irrespective of the type of contract used for a
construction project, sometimes part of the tendering process for a job
requires pre-qualification. Such pre-qualification is intended to assure
that potential organisations submitting tenders have the appropriate
experience and financial backing to carry out such projects.
Lump sum contracts (with and without ‘rise and fall’)
The contract for the works is for a specified lump sum, payable via periodic progress payments.
Often, the final lump sum paid by the proprietor varies from that originally agreed on. This is frequently a
consequence of variations to the contract, that is, additions, omissions or deletions in the scope of works. The
contract provisions will usually allow for variations and following adjustments of the contract lump sum. ‘Rise
and fall’ refers to the inclusion of a cost intended to cover any increase or decrease (rise or fall) in the use of
labour and/or materials that may occur during the life of the project. Not including such a clause potentially
forces the builder to cover the full sum of any cost increases, damaging the profitability of their work. In essence,
a rise and fall clause is intended to ‘pass on’ any unexpected savings or cost increases, whether in part or whole,
to the owner; any savings become the savings of the owner in addition to the builder, and the builder is partially
insured from some of the risks posed by fluctuating prices of labour or materials.
Care must be taken with this type of contract to make sure that the plans and specifications are interpreted
mutually by all parties. This is important, as lack of understanding on how to read these contracts can lead to
misunderstandings, conflict, and consequently non-adherence to the agreed lump sum. The reason for this is
that if one party interprets the contract as entailing a higher final cost than another due to a certain
understanding of the specifications not shared with that other party, the other party will likely have interpreted
the cost-difference as being the result of variations to the contract, and therefore as an non-agreed upon extra
cost.
Design and construct contracts
Under a design and construct arrangement, the builder is responsible for the design and construction of the
building, without direction from the owner. The builder will also be required to provide the owner with
warranties of fitness for purpose of the design and the quality of workmanship.
Under design and construct in its conventional form, the builder undertakes all the design work based on a
design brief provided by the building owner, sometimes referred to as the ‘principal’s project requirements’. On
completion, the builder hands the building over to the owner, who only has to turn the key (to open the door to
the building, that is), which is why this method is also known as ‘turnkey’. Variations on the design and construct
model include:
‘Design, development, and construct’, in which the proprietor provides the preliminary design to be
further developed by the builder
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‘Design, novate, and construct,’ where the proprietor novates their design consultants, following
preliminary design, to the builder.
‘Novation’ refers to the process of releasing the original party to the contract from their obligations, and
transferring these obligations to another party; alternatively, the original parties remain, but substitute their
original agreement for a new one. In design, novate, and construct contracts, the first mode of novation is
undertaken, as the design consultants who previously worked for the owner for the purpose of fulfilling contract
conditions are transferred to the builder (that is, their obligation to consult on designs are transferred), who
shall rely on their services to fulfil their contractual roles.
One of the goals of varying the conventional design and construct model is to allow the proprietor a greater
degree of design control. Generally, the builder will be required to provide the proprietor with certain warranties
as to fitness for purpose and quality of workmanship.
Cost plus contracts
Under a cost plus contract, the proprietor pays the contractor the actual cost of the work plus agreed profit
above the actual cost. This type of contract requires thorough and detailed preparation and administration for
its success. Successful cost plus contracts require trust between the owner and the contractor, as ineffective
communication concerning what constitutes cost can lead to conflict between the parties. Defining the scope of
the works to be constructed is crucial in this type of project, as drawings and/or specifications are normally not
completed at the commencement of the project.
A cost plus type contract without a guaranteed maximum price (GMP) can lead to many pitfalls; therefore, the
earlier the complete works of the project is agreed to, the better.
RESTRICTIONS ON COST PLUS CONTRACTS
(taken from Domestic Building Contracts Act 1995 (Vic), s 13)
(1) A builder must not enter into a cost plus contract unless – (a) the contract is of a class allowed by the
regulations for the purposes of this section; or (b) the work to be carried out under the contract
involves the renovation, restoration or refurbishment of an existing building and it is not possible to
calculate the cost of a substantial part of the work without carrying out some domestic building work.
Penalty: 100 penalty units.
(2) A builder must not enter into a cost plus contract that does not contain a fair and reasonable estimate
by the builder of the total amount of money the builder is likely to receive under the contract.
Penalty: 100 penalty units.
(3) If a builder fails to comply with this section –
(a) The builder cannot enforce the contract against the building owner, but
(b) The tribunal may award the builder the cost of carrying out the work plus a reasonable profit if the
tribunal considers that it would not be unfair to the building owner to do so.
What‘s a penalty unit?
The penalty unit system is a way for regulating bodies to issue fines to builders and tradespeople who fail to
comply with the Act in their contractual dealings. A fine is paid, as opposed to needing to go to court for the
misdemeanour. For example, in Victoria, each penalty unit is equivalent to $151.67.
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Construct-only contracts
Under a traditional head (or principal) contract, the main building owner engages a designer (architect/engineer)
to design the building. On completion of the design documentation, the project may be tendered out to builders
and, ultimately, the building owner enters into a contract with a builder for the construction of the building in
accordance with the design. This method is also known as ‘construct-only’ because the builder is only responsible
for the provision of all services necessary for the construction of the building. The design responsibility lies with
the building owner and their design consultants.
In order to deliver the project and ensure that all contractual obligations owed to the building owner are met,
the builder subcontracts part of the works to various trade subcontractors, supervising and coordinating their
work. The building owner’s contract is with the builder only, and not with the subcontractors; therefore, the
builder remains contractually responsible to the owner for all work carried out by the subcontractors.
Generally, the builder will not be able to subcontract all of the works, or assign their contractual responsibility
to another party. Costs can refer to a wide range of activities/things to be paid for, including labour, wages,
subcontractors, materials, rental, documentation, travel, royalties, and much more.
Schedule of rates
Under a schedule of rates contract, the proprietor pays the contractor for the amount of material used, at the
agreed rate. The schedule of rates used to adjust labour rates may not be agreed upon at the time of entering
into the contract.
Bill of quantities
Some commercial contracts operate on a ‘bill of quantities’ progress-payment system. Under this class, the bill
of quantities forms part of the contract, and the proprietor pays the contractor for the exact amount of labour
and materials provided. There are various ways to approach using bill of quantities progress-payments. The
contractor must decide the appropriate rates depending on the trade (or combination of trades) engaged in the
works.
Turnkey contracts
This type of contract is widely used in the design and construction of petrochemical, process engineering, and
chemical plants. Here, the owner of the project asks for a design and construct of the facility. Payment of the
project generally occurs whereby the contractor hands over the keys to the owner – the owner ‘turning the key’
to enter the building is a symbol of its completion, hence the name ‘turnkey contract’. It is at this point that the
contractor receives payment in full.
Joint Venture
This type of contract may be suited to organisations pursuing projects in overseas markets. Although they may
possess expertise in completing projects within their home country, the varying circumstances in which
construction is undertaken internationally might compel them to enter into a partnership with local
organisations familiar with how construction is conducted in the relevant country. In exchange for the local
groups providing accurate information and resources to meet the needs of the construction project, the
organisation shares both responsibilities and profits with them. As such, this arrangement is often of benefit for
both organisations. Examples of parties likely to enter into a joint venture agreement are local subcontractors,
vendors, and labour markets.
Contracts for domestic building work
Contracts for domestic building work must be in accordance with your State or Territory consumer protection
legislation regulating residential building work. This legislation requires that contracts be written in a specific
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form and include certain provisions. As mentioned above, each State and Territory contains its own unique
legislation.
A domestic building contract which is not made out in writing may not be contractually enforceable. Therefore,
a builder who performs building work without a written contract may be unable to enforce any contractual rights
and may only recover under a claim for quantum meruit, which is a Latin term meaning ‘what one has earned’.
In the context of building and construction law, it means ‘reasonable value of the services provided’. Put simply,
a builder without a written contract can only demand payment for the value of the goods and services provided.
Controls that typically relate to all domestic building contracts
Controls across States and Territories usually state that:
Warranties must be included in every domestic building contract
If the contract is a mixed contract (a contract that deals with domestic building work in addition to
some other matter) then:
o the domestic building work must be separately described, and both sections must be costed
separately
o copies of the contract must be signed by all parties and provided to the owner as soon as
practicable; this can be no later than five business days after signing the contract
A builder can only accept a certain deposit amount (that is, it specifies the maximum amount of deposit
a builder can receive)
If the builder wishes to exclude the cost of connection or installation of services (e.g. gas, electricity,
water, sewerage, and telephone) or planning or building permits from the contract, he must do so in
the prescribed manner
If the builder wishes to exclude the cost of certain fixtures and fittings which appear on the plans and
specifications, he must do so in the prescribed manner
Cost plus contracts are prohibited, except in certain circumstances
The use of cost escalation clauses (clauses which may have the result of the contract price increasing)
is prohibited, except in certain circumstances
Controls on the use of Prime Cost Items and Provisional Sums must be included
Additional controls that relate to major domestic building contracts
Controls across States and Territories usually state that:
The builder must be registered
Foundation data must be available to the builder prior to the signing of the contract
The contract must be in writing, signed by both parties, and must:
o contain a completion date (instead of a time for completion), unless the start date cannot be
determined. If the starting date is not known at the time of signing the contract, then the
contract usually must state the number of days until completion
o contain a check list in the approved form
The contract must set out the allowance which the builder has made for delays in relation to a number
of items
The owner may have a cooling-off period after the signing of the contract
The builder must advise the owner, in the approved form, of the existence of the cooling-off period, if
applicable
There are restrictions on the progress payments which a builder can recover under the contract
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There is a restriction on when the builder is entitled to demand the final payment.
9.4 STANDARD FORM CONTRACTS
Generally, the contracts used for the majority of building projects - both domestic and commercial - are known
as ‘Standard Form contracts’. Contracts in the building industry are numerous. For example, there are contracts
between:
The owner and the builder
The builder and subcontractors
The builder and suppliers
The builder and their employees
The owner and their consultants, such as architects, engineers, and draftspersons
The Australian Standard Form Contracts are identifiable by way of a two-part code – the first being the Australian
Standard number and the second being the year of publication. The latter can be crucial in identifying the form
being referred to.
The advantages of using standard form contracts include:
Convenience and economy of having a ready-made contract
Working familiarity
Ability to highlight areas where the contract conditions do not work well
Standard contracts are revised and updated intermittently
All standard form contracts typically contain a number of common clauses. It is important that the parties
involved assess the implications of the use of any given contract. At times, to account for the particular
circumstances of the project, special conditions may be inserted upon the mutual agreement of all parties.
Main types of Standard Form Contracts
There are a number of Standard Form Contracts published. These include:
New Homes Contracts
Alterations, Additions & Renovations Contracts
Kitchen, Bathroom & Laundry - Supply and Install Contracts
Small Works Contracts (usually for work not requiring foundation data)
Cost Plus Contracts
Domestic Building Contract for Building Works under a value threshold
Building Contract for Construction of Kit Homes
Factory Built Transportable Homes Contract
Medium Works Commercial Contract
In addition to these contracts, a range of Standard Forms exist, including:
Commencement Notice: Notification by the builder of the date at which building works began on the
site.
Variation Document: Notice by the builder of the details of work comprising the proposed variation,
the additional costs of those works or credit involved, and an estimate of the delay which the variation
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will cause. This notice is intended to be signed by the owner and returned to the builder as
confirmation that the variation works may proceed.
Notification of Extension of Time: Notice by which the builder advises of an extension of the prior time
to completion of the building works claimed by the builder, including the period of time claimed as
extension and the reason for the delay.
Progress Claim Certificate: Notice by the builder claiming payment for a stage of the works, including
variations carried out during that stage and a statement of the total value of previous claims,
adjustments, variations, other amounts due, and total payments received to date.
Notice of Completion: Notice by the builder of the date on which all building works were completed,
inviting the owner(s) to inspect the works.
Notice of Suspension of Works: Notice by the builder that they suspend performance of the Building
Works, pursuant to the contract.
Expert advice should be sought before works are stopped or suspended and before any notice of suspension is
given. In Victoria, the following are typical Standard Form Construction contracts:
Housing Industry Association (HIA)
o Alterations, Additions and Renovations
o New Homes Contract
o Small Works Contract
o Medium Works (commercial contract) Conditions
Master Builders Association (MBA)
o Building Contract – Home Improvements
The Royal Australian Institute of Architects (RAIA/MBA)
o ABIC MW-1 2003 Major Works Contract – Owner’s Copy
o ABIC MW-1 2003 Major Works Contract – Reference Copy
o Schedule 1 Contract Information – Housing in Victoria
o Schedule 2 Special Conditions – Housing in Victoria
o Schedule 9 Non-domestic Building Work – Housing in Victoria
o Information for the Owner – Housing in Victoria
Such Standard Form contracts contain standard conditions and are
prepared by various industry bodies and parties involved in the
construction industry. Parties may include architectural and master
builder associations, building owners and managers, standards
committees, and Government departments. Standard Form contracts
have evolved from a process of negotiation and discussion between the
various parties involved in a range of construction projects. However,
no Standard Form contract will contain all the terms and conditions that
a particular group desires.
The ‘New Homes’ Contract for your State/Territory
Your trainer will run through typical sections of your relevant State/Territory New Homes Contract (provided as
part of the course material for this unit), covering:
Builder's obligation to obtain Foundation Data
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Copyright Plans, and the order of precedence of documents
The Cooling-Off Period
The Checklist
The Index
Particulars of the Contract
Time for Completion -Building Period
Exclusions from the Contract Price
Deposit
Responsibility for the Planning Permit
Responsibility for the Building Permit
Number of Days to make Progress Payments
Percentage applicable to Extra Work
Agreed Damages for Delays
Percentage if Contract is ended
Lending Body Finance
Table of Australian Standards for Contracts
Included are some of the most commonly used Australian Standards relating to Standard Form contracts,
followed by notable examples of Standard Form contracts.
AUSTRALIAN STANDARDS RELATING TO STANDARD FORM CONTRACTS
AS 2124 – General Conditions of Contract
Construct-only
Published by Standards Australia
Administered by a superintendent; the contractor constructs the works based on a design completed
by the principal/owner (generally through the principal‘s consultants).
AS 2545 – Subcontract Conditions (companion to AS 2124)
AS 4300 – General Conditions of Contract for Design and Construct
Design and construct
Published by Standards Australia
Commercial
Does not comply with domestic building legislation
Administered by a superintendent; the contractor must design and construct the project.
AS 4303 – General Conditions of Subcontract for Design and Construct
(companion to AS 4300)
AS 4305 – Minor Works Contract Conditions
Administered by the owner/principal for relatively minor works
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AS 4000 – General Conditions of Contract
Construct-only
Published by Standards Australia
Commercial
Does not comply with domestic building legislation
Administered by a superintendent; the contractor constructs the works based on a design completed
by the principal/owner (generally through the principal‘s consultants, architect, or engineer)
AS 4901 – Subcontract Conditions (companion to AS 4000)
AS 4902 – General Conditions of Contract for Design and Construct
Design and construct
Commercial
Does not comply with domestic building legislation
Published by Standards Australia
AS 4903 – General Conditions of Subcontract for Design and Construct (companion to AS 4902)
EXAMPLES OF STANDARD FORM CONTRACTS
2006 (edition 4) MBAV New Homes Contract – HC-5
Construct-only
Domestic
Published by MBA (Master Builders Association)
Favours builder/contractor
2003 Australian Building Industry Contract – ABIC MW – 1 Major Works
Contract
Construct-only (value range: $100,000 to $25 million)
Commercial and domestic
Can be amended to design and construct
Published by RAIA
Administered by an architect; the contractor constructs the works based on a design completed by the
principal/owner (through the architect)
2002 Australian Building Industry Contract – ABIC SW – 1 Simple Works
Contract
Construct-only (value range: up to $2 million)
Commercial and domestic
Can be amended to design and construct
Published by RAIA
Administered by an architect; the contractor constructs the works based on a design completed by the
principal/owner (through the architect)
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1981 (edition 3) General Conditions of Contract – NPWC3
Construct-only
Civil/commercial
Published by national public works council
Mainly used by government departments and agencies
Oldest standard form contract in use
Works not requiring contracts
In Victoria, by law, the builder must use a major domestic building contract for work worth more than $5000,
including:
erecting or constructing a home and associated landscaping, paving, retaining structures, driveways,
fencing, lighting, heating, air conditioning, water supply or sewerage
renovations, alterations, extensions, repairs and any other improvements; for example, a swimming
pool, kitchen renovations, outdoor living areas
work associated with renovation, alteration, extension or repair of a home
demolition or removal of a home or part of a home
preparation of plans or specifications by the builder or tradesperson (a registered architect, engineer
or draftsperson will use their own contract)
if the contract has been split into several smaller amounts worth less than $5000
For building works under $5,000, works must still be completed by a licenced plumber, electrician or if it
requires demolition, re-stumping, re-blocking or structural work by a registered building practitioner, but works
do not require a contract to be signed.
Written agreements such as a structured quote and a
written acceptance are recommended as good
practise.
Minor Works Contracts
Minor works contracts are governed by the Australian Standard 4906-2002.
Minor works contract cover residential building work worth between $5,000 and
$20,000. The Minor Works Contract is a lump sum contract to be used for minor
works with a value of less than $20,000 (GST inclusive). It is a contract between
a contractor and residential owner.
Renovation, Extension and Repair Contract
A renovation, extension and repair contract is recommended for the renovation, extension, improvement and
routine repair of a home (including a house, duplex or unit), or associated work (e.g. landscaping, pool building,
etc.) If the total cost of your project is more than $5000, the contract must comply with a major domestic
building contract even if the contract is split into several smaller amounts – for example, a pre-construction
contract worth $2000 and the main contract worth $4000.
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9.5 RIGHTS AND LIABILITIES OF PARTIES
A construction contract is made up of terms and conditions granting rights (and imposing liabilities) on the
parties to the contract.
A contractual right is an entitlement/benefit that a party receives as a result of the contract
A contractual liability is an obligation/debt that one party agrees to accept as a result of the contract
Listed below are some of the major rights and liabilities afforded to parties in a construction contract. Further
consultation of a specific building contract and its supporting documents is necessary to determine all that may
be applicable.
(Note: text taken from Master Builders Association of Victoria - New Homes Building Contract)
10. BUILDER'S OBLIGATIONS
10.1 The Builder's warranties
The Builder gives to the Owner the following warranties contained in Section 8 of the Act:
The Builder will carry out the Works in a proper and workmanlike manner and in accordance with the
Plans and Specifications set out in the Contract.
Materials supplied by the Builder for use in the Works will be good and suitable for the purpose for
which they are to be used and, unless otherwise stated in the Contract, those Materials will be new.
The Builder will carry out the Works in accordance with all laws and legal requirements including,
without limiting the generality of this warranty, the Building Act 1993 and the regulations made under
that Act.
The Builder will carry out the Works with reasonable care and skill and will achieve Completion by the
date (or within the period) specified in the Contract.
If the Works consist of the erection or construction of a home or is work intended to renovate, alter,
extend, improve or repair a home to a stage suitable for occupation, the Builder will carry out the Work
so the home will be suitable for occupation at the time the Works achieve Completion.
If the Contract states the particular purpose for which the Works are required, or the result which the
Owner wishes the Works to achieve, so as to show that the Owner relies on the Builder's skill and
judgement, the Builder warrants that the Works including any Materials used will be reasonably fit for
that purpose or be of such a nature and quality as they might reasonably be expected to achieve that
result.
11. OWNER'S OBLIGATIONS
11.1 Evidence of capacity to pay the contract price
The Owner will within fourteen (14) Days of the Owner signing the Contract, provide written or other
reasonable evidence to the Builder that the Owner has the financial capacity to pay the Contract Price.
11.2 Continuing obligation upon owner to provide evidence of capacity to pay
The obligation of the Owner to provide evidence of capacity to pay the Contract Price is a continuing
obligation until the Works have reached Completion.
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11.3 Builder may request evidence of capacity to pay during the contract
The Builder may at any time until the Works have reached Completion, request the Owner to provide
written or other reasonable evidence of capacity to pay the balance of the Contract Price or any variation
notwithstanding the fact that the Owner has previously provided such evidence to the Builder under the
Contract, and the Owner will, within fourteen (14) Days of any request, provide evidence of such capacity to
pay.
11.4 Owner's obligations if capacity to pay is reduced or ceases
The Owner will immediately notify the Builder if at any time during the Works the Owner's capacity to pay
the Contract Price or the balance of the Contract Price is in any way reduced or ceases.
11.5 Owner's obligation to pay the contract price
The Owner will pay the Builder the Contract Price in accordance with this Contract.
11.6 Owner's obligation to pay deposit
The Owner must pay to the Builder the Deposit specified in item 10.2 of the Appendix. This Deposit must be
paid on demand, but no demand may be made by the Builder for it to be paid
unless the Builder has complied with its obligations under clause 5.3;
OR
until the Builder has complied with its obligations under clause 5.4.1
Whichever applies to this Contract. (See also Clause 5.4.2) In the event that the Owner validly exercises its
rights (if any) under the Cooling Off provisions of the Act, the Builder will refund to the Owner any deposit
that the Owner may have already paid. HOWEVER, pursuant to Clause 7.3, the Builder may retain from the
refund:-
one hundred dollars ($100.00) plus
Any out of pocket expenses or disbursements that the Builder may have already incurred, with the prior
approval of the Owner.
11.7 Limits on deposit payable by the owner
The Deposit to be paid by the Owner will not be:
more than 5% of the Original Contract Price if the Original Contract Price is
$20,000 or more;
OR
More than 10% of the Original Contract Price if the Original Contract Price is less than $20,000.
11.8 Owner to pay progress payments
The Owner will make Progress Payments to the Builder in accordance with the agreed and completed
Progress Payments Table as set out in Item 23 of the Appendix.
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11.9 Owner to pay progress claims within the stated period
The Owner will pay each Progress Claim to the Builder within the period stated in Item 12 of the Appendix.
11.10 Interest payable on outstanding payments
If the Owner should fail to make any payment to the Builder by the due date under this Contract, the
Builder will be entitled to interest on all outstanding amounts at the rate specified in Item 15 of the
Appendix, payable from the due date until the payment has been made in full.
11.11 Materials supplied by owner to be good and suitable for their purpose
If the Owner supplies Materials for use in the Works, the Owner will supply such Materials which are good
and suitable for the purpose for which they are to be used and, unless otherwise stated in the Contract,
those Materials will be new.
11.12 Any plans or specifications supplied by owner to be accurate and sufficient number of copies to be
provided
Whenever the Owner supplies Plans and/or Specifications to the Builder, the Owner:
warrants that the Plans and/or Specifications supplied are accurate and correct and good and suitable
for the purpose for which they are to be used; AND
acknowledges that it is reasonable for the Builder to rely on the Plans and/or Specifications supplied
and that the Builder intends to rely upon any Plans and/or Specifications supplied for the purpose of
carrying out the Works;
AND
The Owner will supply sufficient number of copies to enable the Builder to undertake the Works and to
obtain the necessary permits, if the Builder is required to do so under this Contract.
11.13 Foundations data provided by owner to be accurate and may be relied upon by the builder
Whenever the Owner provides Foundations Data to the Builder, the Owner:
warrants that the Foundations Data provided is accurate and correct; AND
Acknowledges that it is reasonable for the Builder to rely on the Foundations Data provided and that
the Builder intends to rely on it for the purpose of carrying out the Works.
11.14 Owner's obligation not to interfere
The Owner must not do, or countenance or permit to be done, anything that may obstruct, interfere with or
hinder the Builder in carrying out its obligations under the Contract and otherwise.
Without limitation, the Owner must ensure that the Owner, the Owner's Agent and all persons for whom
the Owner is responsible refrain at all times from:
communicating directly with, or giving any instructions to, any of the Builder's employees, consultants,
subcontractors or suppliers, and all other persons, consultants, subcontractors or suppliers involved on
the project; with the sole exception of those with whom the Owner may have entered separate
contracts.
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The Owner must also ensure that no animals over which it may have any control obstruct, interfere with or
hinder the Builder or the progress of the Works.
11.15 Owner to act in furtherance of program
Whenever under the provisions of the Contract it is, or becomes, necessary for the Owner to make any
decision or selection, or to supply any information, instruction, advice, equipment, materials and/or labour,
or to do any other act, the Owner shall ensure that such act is done at the time and in a manner that
enables the Builder to meet its program.
9.6 BREACHES AND TERMINATION
Breach of contract
Issues of various kinds may arise even with the best-prepared agreements. If
these issues cannot be resolved, one or more of the parties may be declared
to be ‘in breach of contract’. The term ‘breach of contract’ means that one of
the parties to a contract has failed to do something that the contract requires
that party to do.
Remedies
To resolve an issue or dispute, a remedy is required. Remedy is the action
taken by the other party, or by a third party (such as the court), to restore the
injured party back to the position they occupied before the breach occurred. There are three possible remedies
that are available to the injured party:
Compensation (covering the loss which may have been suffered or the costs of having someone to redo
or finish the work), or any other remedy that might be stated in the contract
Damages, which might exceed an award merely intended to compensate for injury
An order by the court that the party in breach of the contract be required to complete the terms of the
contract (this is called ‘an order for Specific Performance’)
Substantial breach
‘Substantial breach’ is defined in each of the State and Territory New Home Contracts, which generally state the
following:
The Builder is in substantial breach of this contract if the Builder:
Suspends the carrying out of the building works
Has the builder's license cancelled or suspended, or
Is otherwise in substantial breach of this contract.
The contract will often specify what damages are payable to the landowner if the builder delays the construction.
Where the contract sets out the amount that is to be paid, this amount is referred to as ‘liquidated damages’.
Compensation and entitlements under the contract
Can either the builder or the owner terminate the contract? The answer is that, in certain situations, either party
can terminate the contract. Clauses within each of the State and Territory New Homes Contracts generally
provide that:
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If the Builder is in substantial breach of this contract, the Owner may give the Builder a written notice to
remedy the breach:
Specifying the substantial breach
Requiring the substantial breach to be remedied within 10 days after the notice has been received
by the Builder
Stating that if the substantial breach is not remedied as required, the Owner intends to end this
contract.
If the Builder does not remedy the substantial breach stated in the notice within 10 days of receiving that
notice, the Owner may end the contract by giving further written notice to that effect.
Compensation and entitlements other than those under the contract
The owner may also be entitled to damages for loss sustained as a result of
the builder's failure to meet their obligations under the contract. For
example, if a builder ‘walks away’ from a job, the landowner is entitled to
have the work finished by another builder. If the costs of finishing the work
exceed the original builder's quote, the landowner is entitled to recover the
difference from the first builder.
Damages
The general rule is that, in the absence of any contractual obligations to the
contrary, the owner is entitled to the reasonable and foreseeable loss that flows from the breach.
(Note: text taken from Master Builders Association of Victoria - New Homes Building Contract)
18. LIQUIDATED DAMAGES
18.1 Owner's entitlement to liquidated damages
If the Builder fails to bring the Works to Completion by the Completion Date, the Builder will pay or allow to
the Owner by way of pre-estimated and Liquidated Damages, a sum calculated at the rate stated in Item 17
of the Appendix for the period from the Completion Date until the Works reach Completion or until the
Owner takes Possession, whichever is earlier.
18.2 Liquidated damages may only be deducted from final payment
The amount of any Liquidated Damages may be deducted by the Owner from the Final Payment only and
any deficiency may be recovered by the Owner as a debt due to the Owner by the Builder.
Termination
In certain situations, either party may terminate the contract if they follow the correct termination procedure.
If the builder is in substantial breach of a contract, the owner may give the builder a written notice to remedy
the breach. The notice will specify:
The substantial breach
The timeframe for the substantial breach to be remedied after notice received by the builder, and
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That if the substantial breach is not remedied as outlined in the notice, the owner intends to end the
contract
There are similar provisions applied for when the owner is in substantial breach. Factors leading to termination
of a contract may include:
Repudiation – a party renounces the contract either expressly or through behaviour
Acceptance of repudiation –When the innocent party understands and accepts this repudiation, they
are entitled to sue for damages suffered
Unreasonable and vexatious notice – contractor purports to terminate the contract through
oppression, harassment, or annoyance caused to the other party (in essence, the contractor attempts
to annoy or bully the other party so severely that they abandon the contract, thereby evading the
responsibility they would incur if they abandoned it themselves)
Completion – in situations where the contractor is liable to complete the work at the contractor’s costs,
e.g. in the situation of a ‘fixed price’ contract
Abandonment – where both parties mistakenly believe a contract is terminated when it is not, and no
longer perform under the contract
Termination by contract and the operation of law/the terms of the contract
Frustration – contract can be discharged without fault of either party due to ‘acts of God’ (events with
severe effects which occur seemingly randomly, with no discernible cause, or which happen too quickly
to be prepared for/avoided), war, terrorism, severe illness, or where the contract subject matter is no
longer in existence.
9.7 LEGISLATIVE CONDITIONS
Each State and Territory has unique consumer protection legislation to regulate building and construction work.
This legislation provides a level of protection for consumers by dictating what a building contract must - and
cannot - include. Legal liability within the building industry and associated professions involves four main areas:
Tort law
Criminal law
Contract law
Legislation (statutes, acts, and regulations).
Tort law
Tort law covers civil wrongs, including anything which causes economic, physical, or legal harm.
Criminal law
Criminal law involves the government acting as the prosecutor of crimes which injure the health, property, and
safety of both the individual and the general public.
Basic contract law
A contract is a legally binding agreement between two or more parties if it complies with specific rules of
contract law. As such, an alternative definition of a contract is ‘a set of legally binding promises made by one
party or more’. In accordance with contract law, contracts may be terminated or discharged in any one or more
of the following ways, namely by:
Agreement
Performance
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Frustration
Election upon breach
Mutual terms
Contractual right to termination
Liquidated damages
A client will specify that if the project is not complete by the
date nominated in the contract (or as extended by agreement),
then the builder will pay the client liquidated damages of the
contract amount specified, usually calculated on a daily basis.
Categories of contracts
Contracts may be oral, written, or partly oral/partly written. Contracts may take a ‘simple’ or ‘deed’ form. A
deed is a formal/specialty contract which must be signed, sealed, and delivered, and one for which no
consideration is required.
Oral contracts – if the contract is oral, each party in dispute will have difficulty in establishing its version
of the terms of the agreement (the dispute may degrade into a ‘he said/she said’ stalemate)
Partly oral/partly in writing – evidentiary problems will be similar to oral contracts.
The importance of writing
Where the contract is in writing and it appears to be complete, the courts will presume that the contract contains
all required terms. In the event of a dispute:
The parties‘ individual conflicting interpretations of their intentions (terms) will generally not be
relevant
The document is interpreted without regard to extrinsic evidence (oral or additional written evidence
that contradicts or adds to the original terms of the contract).
Terms of the contract
The content (or terms) of the contract are determined at the time the contract was made. Therefore, once a
contract is made, it is fixed, alterable only through variation by mutual agreement.
Express terms
These are the terms of the contract which are specifically agreed to between the parties, and are put in writing
in the contract or agreed to verbally between the parties.
Implied terms
Some terms may not actually be put in writing, talked about, or even considered - but they may be implied by
the agreement and treated as binding nevertheless. These terms may be implied because the law requires them
to be part of the contract, or because common sense, standard industry practice, or past dealings create a
reasonable expectation concerning how (and to what standard) the agreement will be carried out.
These are terms implied by legislation or by the common courts of law. For example, terms implied by, the
Domestic Builders Contract Act (in Victoria) and Australian Consumer Law or common law (on the federal level).
The courts will imply that particular terms be included in particular types of contracts; this is done either because
both parties would probably have explicitly agreed to the terms had they been raised during contract formation
(‘ad hoc’ implied terms), or if the contract cannot be fully realised without them (‘standard’ implied terms).
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For example:
A contract between an architect and their client
A contract between a builder and their client
Warranties or conditions
In contract law, a ‘warranty’ is defined as a declaration, promise, or guarantee from one party to the contract
that a given statement or fact is true, such that its truth can be
assumed and relied upon by the other party. A ‘condition’, likewise, is
an event upon which the fulfilment of the contract depends. As
mentioned before, the formation of a valid contract establishes mutual
duties; a condition is a kind of qualification of a duty/obligation
generated by a contract.
Let’s suppose that Sophie, owner of a charcoal chicken shop, forms a
valid contract with a chicken supplier: the supplier agrees to provide
chicken to Sophie’s shop at a discount on the condition that Sophie buys chicken from them exclusively. The
exclusivity agreement is an example of a condition, qualifying the contractual duty of the supplier to provide
Sophie with discounted chicken; if Sophie buys from another supplier (that is, violates the condition), the original
supplier doesn’t have to discount any chicken she buys. Furthermore, suppose that the chicken supplier tells
Sophie that the chicken she’s buying is organic.
This is an example of a warranty: the supplier is making a promise that the truth of the
statement ‘our chicken is organic’ can be relied upon. Sophie, trusting the supplier,
incorporates the organic status of the chicken in her advertising, after which she
discovers that her supplier lied about their chicken being organic. This would constitute
a breach of warranty on the part of the supplier.
Terms ultimately fall into two classes, warranties or conditions:
Breach of a warranty gives right to damages, but does not entitle the innocent
party to end the contract
Breach of a condition gives right to damages and entitles the innocent party to end the contract
Technically, any breach of a term of a contract entitles the innocent party to damages
Legislation
Legislation is law that has been enacted by the Government. The Trade Practices Act 1974 (TPA) has been
renamed and is now known as the Competition and Consumer Act 2010 (Cth) (CCA). The TPA continues to apply
for transactions that occurred up to 31 December, 2010.
All States and Territories have enacted legislation repealing their respective fair trading legislation and adopting
the national competition and consumer law regime.
Parts of the TPA have been repealed and re-incorporated into the Australian Consumer Law (ACL), as found in
Schedule 2 to the CCA.
Unconscionable conduct – sections 20, 21, and 22 of the ACL
Consumer protection – sections 18 and 29 of the ACL
Offences – Chapters 3 and 4 of the ACL
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Contract validity
A contract may be deemed invalid due to any of the following:
Misrepresentation and misleading conduct (at common law)
This may occur at the pre-contractual negotiations, whereby a party makes a false statement to the
other party.
Misleading or deceptive conduct under the Australian Consumer Law
Section 18 of the ACL (formerly section 52 of the TPA) prohibits a corporation, in trade or commerce,
from engaging in conduct that is misleading, deceptive, or likely to mislead or be deceptive. A person
or corporation may be liable for damages by contravening this legislation.
The intention of the party in contravention of the Acts is irrelevant – it is sufficient if the contravention
took place, and does not matter that there was no fraud, recklessness, or negligence in the misleading
or deceptive conduct.
Mistake
A contract may be void because of a mistake made by one or both parties. A ‘deliberate mistake’ will
void a contract, as the person committing it does not intend to see the contract through, and so they
sabotage it through a ‘mistake.’ Beyond being a punishable offence, it causes undue stress (and often
financial anxiety) to afflict the wronged parties. Mistake is a complex area of contract law; in general,
though, being mistaken about an aspect of a contract won’t allow a party to escape contractual
obligations.
Further information can be accessed at: http://www.australiancontractlaw.com/law/avoidance-
mistake.html
Duress
A contract which is entered into under duress - if the duress compelled a person to act against their
free will and was part of the reason for entering the contract - may be rendered voidable by the
injured/wronged party.
Undue influence
In a relationship of trust/confidence, or one in which one party exerts more influence, undue influence
will be deemed to have occurred where one party takes unconscionable advantage of the other party
through exploitation of the special relationship between the two.
Unconscionable conduct
Section 4 of the ACL (formerly section 51A of the TPA) prohibits a corporation from engaging in
unconscionable behaviour (that is, behaviour which violates general moral/social values), whether in
the course of a consumer transaction or otherwise.
Lack of formalities
Although there is no general requirement for contracts to be in writing (a contract may be oral, written,
or partly oral and partly written), some legislation prescribes that certain contracts comply with
particular formalities.
Incapacity
An enforceable contract requires that both parties have legal capacity to enter into the contract. In legal
terms, the capacity to enter into a contract is based on age (no minors), mental health, intoxication
and/or financial status (namely, bankruptcy).
Uncertainty
A contract‘s essential terms must be sufficiently certain, and not vague or uncertain.
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Illegality
A contract whose purpose is illegal or is against public policy will be invalid.
Statutory intervention
Freedom of contract, as a social/legal principle, assumes equal bargaining power between the parties
to a contract. In reality, this is rarely the case, particularly with regard to consumers contracting with
manufacturers/distributors/companies. Consequently, there has been significant statutory
intervention in the area of contract law. With an emphasis on favouring and/or protecting the
consumer, this legislation has:
o Made small amendments to case law
o Reformed significant portions of the law
Contract law today, therefore, is a mixture of case law (that is, law established as a consequence of the outcomes
of prior cases) and legislation. Remedies for breaches of statutory provisions include damages and injunctions.
The Australian Consumer Law affects consumer transactions; as such, the building industry is not immune from
its operation. In addition, the States and Territories have legislation directly relevant to contracting within the
building industry, such as legislation affecting domestic building contracts and security of payment under
construction contracts.
Security of payment legislation
In recent years, Australian jurisdictions have followed the approach of the United Kingdom by introducing
security of payment legislation.
This powerful legislation seeks to protect the parties who carry out construction work under construction
contracts (builders, subcontractors, consultants, and suppliers), by providing them with a statutory entitlement
to progress payments. This legislation, however, is generally not applicable to domestic building contracts
between a home owner and builder.
Contracts for domestic building work (low rise constructions)
Domestic building contracts are treated as consumer transactions, and thereby fall within the consumer
protection regime. Contracts for domestic building work must comply with the legislation of the particular
jurisdiction, as there is no uniform standard regarding domestic building contracts.
Generally, the various statutes prescribe the following:
Implication of warranties regarding all domestic building work into contracts
Capping of the deposit amount a builder may demand or receive at a specified percentage of the
contract sum
Prescription regarding how prime cost items and provisional sums are to be used in the contract
Prescription of specific requirements for major domestic building work contracts
Provision for a cooling-off period
Regulation of the use of variations
Imposition of limits on progress payments
Prescription of specific requirements for display home contracts
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Domestic Building Contracts Act 1995 (Victoria) (VCAT) – Overview
In Victoria, VCAT has jurisdiction to hear and resolve building disputes arising under a domestic building contract;
as such, resolution is prefaced by a compulsory conciliation
process. Contracts for domestic building work which relate to a
home must be in accordance with the Domestic Building
Contracts Act 1995 (Victoria). This requires that the contract be
in writing, in a specific form, and include certain provisions. A
contract for domestic building work which does not comply with
the legislation may not be enforceable.
Summary
In this section, you have learnt how to:
Identify and apply various types of building and construction contracts
Identify and analyse essential terms and elements of a valid contract
Analyse the importance of identifying an intention to create legal relations
Identify and analyse the rights and liabilities of parties under a contract
Identify and apply common building contract terms and procedures
Identify and analyse circumstances that bring about a breach of contract
Identify and apply legislative requirements
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Learning Activity 9.1 – Building Contracts
This Activity may be completed in pairs.
1. Read Clause 10 of the VBA ‘Consumer Affairs Victoria's model domestic building contract for new
homes’ (URL: http://www.vba.vic.gov.au/consumers/contracts).
2. In your own words describe how Clause 10 impacts the Builder.
You may use this space to take any notes:
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Learning Activity 9.2 – New Home Contract
This Activity may be completed in pairs.
1. Using the VBA ‘Consumer Affairs Victoria's model domestic building contract for new homes’ (URL:
http://www.vba.vic.gov.au/consumers/contracts) complete the following for 10 (ten) general clauses.
Clause number / title Purpose of clause _ No. of Subclauses
1
2
3
4
5
6
7
8
9
10
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Learning Activity 9.3 – Variation to Plans
This Activity may be completed in pairs.
1. Explain what the Variation to Plans and Specifications included in the VBA contract is used for.
Provide a valid example.
2. Why it is important that contracted work is carried out in accordance with the contractual obligations
as outlined and agreed upon by all parties involved?
You may use this space to take any notes:
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SECTION 10: CONTRACT SELECTION
When you enter into a construction contract, it is critically important that you select the correct contract type
for the works to be undertaken.
10.1 SELECT AN APPROPRIATE CONTRACT
Prior to selecting a standard contract for a particular building and construction project, a number of
considerations need to be taken into account:
Type of contract – you need to identify the purpose of the contract (e.g. residential, commercial,
industrial), and which form will best suit your aims (lump sum, schedule of rates, cost plus, etc.)
The scale and complexity of the project – namely, whether the project is considered to be small,
medium, or large, and whether it is a normally or greatly complex project
The works to be carried out – are the works wholly new, or do they consist principally of alterations?
Who will administer or supervise the project? – potential candidates could be an architect, engineer,
or other nominated person
Is a schedule of rates or a bill of quantities included as part of the contract documentation? –these will
define the clarity and extent of payments
Practical completion – From a practical perspective, is it more appropriate for the works to be staged?
Due consideration of each of the above factors will assist in determining the most appropriate type of contract
for the building and construction project in question.
10.2 IDENTIFY CONTRACT DOCUMENTATION
There is a range of documents which, considered collectively, make up a contract. These documents need to be
accurately identified and prepared before the contract can be entered into and the building works undertaken.
These documents include:
A formal instrument of agreement which is signed by both parties (i.e., the contract itself)
General or special conditions of contract – be they Standard Form or specially prepared by lawyers
Approved construction plans
Drawings (usually architectural and engineering drawings. Sometimes, however, they may also include
those of specialist consultants, such as landscape architects and interior designers)
Signed specifications
Approved construction schedules
A Bill of Quantities
Project timelines
Material lists or purchase orders
Labour requirements/human resource projections
Equipment, site accommodation, and services
information
Other information, as required
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Select contract documents
Discuss with your trainer/employer/supervisor in order to determine why each of these documents are
important to contract negotiations and agreement. The contract will normally specify an order of precedence of
the documents, which should be referred to in the event of conflict between the documents:
Formal instrument of agreement
Special conditions of contract
General conditions of contract
Specification preliminaries
Specification
Drawings
An important document to consider - normally forming part of the contract documentation - is AS 2124 General
Conditions of Contract. An overview of the purpose and contents of this document is provided below.
AS 2124 General Conditions of Contract
AS 2124 General Conditions of Contract normally forms part of the contract documentation. Considered broadly,
it represents the interests of all parties to a contract, including provision for the resolution of conflicts and
disputes. For example, the standard includes:
General conditions pertaining to such things as:
o Shop drawings
o Schedules
o Contractor responsibility
o Drawings and specifications
o Limitation of liability
o Dispute resolution.
General conditions – changes in the work:
o The rights of the owner with respect to subcontractors and material suppliers
o Disagreements between owner and contractor
o Payments and completions.
General conditions – miscellaneous provisions:
o This is primarily applicable to renovation and rehabilitation work.
Contractual obligations
The principal obligation of the owner is to pay the contractor the agreed monies for the works they have done
in accordance with the scheduled timelines. Upon practical completion, the contractor usually returns
possession of the site to the owner. In general, neither the principal nor the contractor can assign any rights or
obligations to a third party without both parties agreeing.
The owner/client must give possession of the site to the contractor/builder by the agreed date for the
commencement of the building works. Likewise, the builder/contractor has an obligation to complete the works
to practical completion.
AS 2124 General Conditions of Contract forms part of the contract documentation for a project. Remember that
AS 2124 can also incorporate additional inclusions/exclusions (by mutual agreement) in the form of addendums.
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For example, most of the work within the building and construction industry is carried out by subcontractors. It
is the usual practice of some principal/client to be involved in the process of the appointment of any
subcontractor. AS 2124 allows for such provisions, in order to serve the interests of all parties involved.
Drawings
Working drawings enable estimators, builders, and sub-contract tradespersons to perform their respective
tasks.
Most working drawings have a standard layout of plans, elevations, and detail sections. If you need to acquire
certain information from working drawings, this standard layout will help you to find it. A set of drawings for the
construction of a building consists of some (or all) of the following:
Site Plan
Foundation Plan
Floor Plan
Elevations (four)
Sectional Elevation
Section Details
Bracing Plan
Tie Down/Fixings
Joinery Schedule
Timber List
Most of these relate to on-site construction plans.
General requirements for working plans entail that they be drawn to a scale of 1:100. There are exceptions,
naturally: construction details are required to be drawn to a minimum scale of 1:20, and site plans to a scale of
1:500. However, 1:200 is preferred by many local authorities. The scale may also depend on the area of the site.
Off-site tradespeople - like construction workers - must be able to read and interpret plans without error. The
interpretation of plans is often the only method by which you will be able to calculate the size of the products
you are going to produce (and consequently the materials you will need).
10.3 SELECT SUBCONTRACTORS
You should not choose a subcontractor based only on their tender bid price; you should also review the quality
of their work on previous projects. Getting a good price doesn‘t mean much if the work is shoddy or partially
completed. You have every right to ask for references for the
subcontractor's previous work, including contacting their previous or
existing clients. The examination of three jobs should be enough to make
an informed decision. When you check the subcontractor‘s references,
don't just contact the people the subcontractor specifies. These may be
family members or friends. The best way to check up on previous work is to
go to current job sites or find independent referees.
If the trade is licensed - plumbing and electrical for example - you must
confirm that the subcontractor and all their personnel working on-site have
the appropriate licences and insurances to perform and sign off the work.
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Contractor scope
Before agreeing on final terms and price, you should meet with the subcontractor to agree on the scope of their
work. For example, the scope of work for a window contractor will include documentation covering the types of
windows, frame construction and finishes, and all the hardware that the
contractor is required to provide to finish the job. The scope will also
include installation, delivery, and other general conditions of the work
associated with the site.
In order to sort out and agree upon final terms with the subcontractor, you
also need to agree on payment terms, the schedule, and any other project
conditions, including site induction, safety, work processes, and clean up
procedures at the same time.
If there are areas of work concerning which two different subcontractors
may have overlapping duties, you must make sure that you clarify the
person responsible for these tasks within the scope of work. It is better to
get this sorted out at the outset, as if these issues arise during construction,
they could cause unnecessary delays. You may also need to determine who is responsible for obtaining licences
and permits, and include these details in the contract.
The terms of service must be included in the agreement, including start and end dates for all services to be
performed. In addition, these terms should define the date deliverables or milestones that should be met if work
is to be completed in the planned phases.
Contractor capacity
Following the scope meeting, you should have a thorough understanding of the potential subcontractor‘s
capacity to complete the required work. In legal terms, the capacity to enter into a contract is based on age (no
minors), mental health, intoxication and/or financial status (namely, bankruptcy). For a contract to exist and be
enforceable, all parties must have the legal capacity to enter into the contract.
From a business perspective, you must also ensure that the subcontractor has the necessary skills, knowledge,
and resources (human and financial) to complete the work. You also need to confirm that they can complete
their work on time, as per the construction schedule. It is not worth entering into a contract based on price with
anyone who will not complete their work on time, potentially holding up other trades and eventually delaying
final handover of the building.
10.4 FORM A BINDING AGREEMENT
Intention to form a contract
It is essential that the two parties to a contract have intended that their
agreement be legally binding. In the case of business agreements, this
intention is usually presumed unless there is an 'honour' clause indicating
otherwise. Where it is not intended to establish a contractual relationship
in the initial stages, a letter of intent is commonly used. A letter of intent is
generally not an acceptance of an offer, but only an expression of intent to
enter into a contract at some time in the future. It may, however, constitute
an acceptance of an offer if its wording is sufficiently precise.
On occasions, a letter of intent may constitute an acceptance of a collateral
or preliminary contract; that is, the principal will be liable to the contractor
for the cost of preliminary work - such as investigation, design, and drawing
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work - when carried out in anticipation of being awarded the main contract. It can be helpful to think of a
preliminary contract as a ‘mini-contract’, intended to cover the costs of the background work required before
the main contract work can be started. A principal who requires a contractor to commence preliminary work
may issue a letter of intent, authorising preliminary work to a limited value.
Unless a letter of intent provides such details, it is not contractually binding and should not be acted on by a
contractor. A contractor receiving a letter of intent - being prepared to take the commercial risk involved in
starting work - should make it clear that by commencing the preliminary work on the contract, they are not
agreeing to conditions which may subsequently be presented. If they don’t make this clear, the contractor may
be held to have accepted the principal's conditions as part of a contract by performance.
Consent to contract conditions
An acceptance must be positively communicated to the offerer and free of qualifications, if it is to be valid. This
is because conditional acceptance (that is, acceptance with qualifications) is considered to become a counter-
offer. The acceptance can only be made by parties to whom the offer was made. Once acceptance is made, it
cannot be withdrawn without permission of the offerer. Acceptance must be indicated within the validity period
or, if no validity period is set, within a reasonable time. For an offer to be validly accepted, it is necessary for
both parties to agree with, and understand, every important term of the offer. This is called 'a meeting of the
minds'. The courts assume that there was a meeting of the minds when the offerer takes reasonable steps to
ensure that all terms are brought to the attention of the offeree. For this reason, conditions of purchase should
be printed on the reverse of invitations to quote and referred to on the face of the document. It is the
responsibility of offerees to familiarise themselves with conditions of sale or quotation.
Where a quotation or tender is offered containing terms such as conditions of sale
or conditions of contract, it is essential that the terms be fully comprehended
before accepting the offer. Once an offer is accepted, the offeree will be bound by
the terms, no matter how unfair they may be. Presentation of fine-print contract
conditions satisfies the legal test of bringing the offeree's attention to the
conditions, and failure to read the conditions represents no excuse at law. As in
one’s dealings as a consumer, so in work: always read the fine-print of a contract.
Included in an offer –whether implicitly or explicitly - are terms relating to the
mode of accepting that offer. An acceptance must be made in the manner
required by the person making the offer; for instance, the offerer may require the
acceptance to be in writing, in which case an oral acceptance would not establish
a contract. Hence, when accepting an offer, it is necessary to accept in the
appropriate manner in addition to indicating acceptance of the other terms of the offer. A principal's conditions
of tendering may modify the normal rules as to the mode of acceptance of an offer. Ideally, they would stipulate
that acceptance must be in writing.
An offer can be withdrawn before it is accepted, as long as notice of the withdrawal is received by the person to
whom the offer was originally sent prior to their acceptance. Usually, a tender may be withdrawn before it is
accepted, even in cases where the tenderer undertakes to keep
the tender open for a certain period. An exception is made where
the principal's wording of the tender form incorporates an
element of consideration in return for keeping the tender valid.
An example is 'In consideration of the tenderer undertaking to
keep their offer open for the validity period, the principal
undertakes to examine the tenderer's offer.' In this manner, a
collateral or ancillary (secondary) contract is created, with its own element of consideration. Sometimes a
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nominal sum of money (e.g. 10 cents) is offered as consideration. It is unwise for a principal to force a tenderer
to keep open an offer which the tenderer wishes to withdraw. In such cases, variations, claims, defective work,
repudiation of the contract, and liquidation of the contractor are likely to follow.
Valid acceptance of an offer requires both the intention to form a contract and a positive action on the part of
the offeree. It is not possible to impose contractual liability on the offeree by stating that silence will constitute
acceptance.
Summary
In this section, you have learnt how to:
Accurately select a contract appropriate for the type of construction
Accurately identify and prepare a range of documents that collectively make up a contract
Accurately identify and apply requirements associated with an offer and acceptance of a contract
Confirm the capacity of the parties to form a binding agreement in the form of a contract
Identify and apply factors associated with the parties’ consent to contract
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Learning Activity 10.1 – Contract Selection
This Activity may be completed in pairs.
1. Prior to selecting a standard contract for a particular building and construction project, what 5
considerations need to be taken into account?
You may use this space to take any notes:
Learning Activity 10.2 – General Conditions of Contract
This Activity may be completed in pairs.
1. In your own words, give a brief interpretation of AS 2124 General Conditions of Contract.
You may use this space to take any notes:
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SECTION 11: CONTRACT ADMINISTRATION
When dealing with contracts, it is essential that you seek professional advice if you do not understand, or are
unfamiliar with, contract clauses or processes.
11.1 PREPARE THE CONTRACT
The successful construction of a building project is dependent upon the successful execution or administration
of the contract.
Compulsory elements / Formal requirements
Legislation in most States and Territories has introduced requirements that must be complied with in relation to
domestic building contracts. These are generally procedural in nature. Some examples may be requirements to
the effect that the contract:
Must be in writing
Must set out, in full, all the contractual terms
Includes a detailed description of the work to be carried out
Includes plans and specifications for the work, containing sufficient information to enable the obtaining
of a building permit
States the names and addresses of the parties to the contract
Is signed by the building work contractor and building owner personally, or through an agent authorised
to act on behalf of the contractor or building owner.
The building owner must be given a copy of the signed contract as soon as reasonably practicable after it has
been signed by both parties, together with a notice in the prescribed form containing the prescribed
information.
Terms and Conditions
A successful contract is only as good as its terms and conditions. Common terms and conditions may include:
Definitions
Contract formation
General obligations
Variations
Contract price and payment
Insurance and liability
Duration, handover, and defects liability
Termination
Disputes
Materials
Price warnings
Payment schedule (progress payments)
Extension of time conditions
Use of drawings and specifications
Other miscellaneous documents which the parties feel ought to form part of the contract
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A general clause detailing notices, assignment, subcontracting and the scope of the agreement,
amendment, representation, severance, and waiver
Contract preparation procedures
Whether the building works are for a new building, refurbishment, extension, or maintenance works, the
procedures are very similar and usually include the following:
Assessment of clients' requirements and preliminary solutions
Formal feasibility study, if required
When works deal with an existing building, preparation of existing plans
When works concern a new building, measurement of the site
Initial scheme drawings
Full scheme drawings
Obtaining planning, building regulation, and other required consent
Preparation of specification/bills of quantity
Obtaining competitive tenders, with the process carefully controlled
Analysis of tenders received and tender report
Commencement on-site
Contract administration – building contract management, preparation of contract documents,
supervision of the contractor, documentation, and reporting
Monitoring of the program of work, quality of work, and costs
Identification of poor working practices, defects, and damage
Work rejected, if appropriate
Agreement of final account
Other inclusions
Clauses:
o Adjustments should be made to the document when required, in order that the contract does
not become frustrated or circular in its operation
o Special clauses will require drafting by legal experts
o Low rise commercial work is subject to limited regulation; commercial contracts mainly
operate under contract and common law
Meanings, interpretations, and definitions; e.g. explanation of the intended and particular meaning of
words that are contained in each contract
Express and implied terms
Other terms and procedures that will prevent confusion arising between clients and builders over the
meaning of building terms, especially when terms are not defined in the contract
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Checklist
Before signing a legally binding contract, check the following items:
Item/question YES or NO
Has an insurance policy or certificate of currency for builder's insurance been issued and
provided to you? If not, is the Contract conditional upon you receiving either an insurance
policy or a certificate of currency for builder's insurance?
If the Contract is conditional upon the Owner receiving written approval for finance, has
the Owner obtained such approval?
Has the Owner had the Contract long enough to read and understand it?
Has the Owner been provided with evidence that the Builder named in this Contract is
registered with the Building Practitioners Board?
Are the Price and Progress Payments clearly stated?
Does the Owner understand how the price is calculated, and how it may be varied?
Has the Builder assessed the suitability of the site for the proposed works and, if tests are
necessary, have they been carried out before signing the Contract?
If a Deposit is payable, is it within the legal limit? The maximum under the Domestic
Building Contracts Act 1995 is: (i) 10%, if the Price is less than $20,000 or; (ii) 5%, if the
Price is $20,000 or more.
Is the work shown and described clearly in the Contract, Plans, or Specifications, and any
other relevant documents - such as engineering computations or the soil report?
Are the Owner's special requirements or finishes included in the Plans or Specifications?
Are the commencement date and Completion Date clearly stated, or capable of being
ascertained?
Is the procedure for extensions of time understood?
Are any Provisional Sums or Prime Cost Items clearly stated in the schedules, and
understood?
Is the procedure for variations of Plans or Specifications understood?
Do you understand the circumstances in which you can end the Contract?
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11.2 SEEK EXPERT ADVICE
Before developing a contract, it is important that you seek advice from people who have the particular
qualifications and experience needed to provide relevant and accurate information in support of your efforts.
Unless you have the specific qualifications and experience, taking the ‘do it yourself’ approach can be a costly
mistake. Two specialists that you might use are i) legal practitioners (solicitors) and ii) conveyancers.
Expert advice can be sought for all aspects of work in the
construction industry. All tradespersons and professionals possess
some degree of skill in their specialised subject-matters which
laypeople (non-professionals) lack; the proper implementation of
these skills can (and does) have a major impact on the successful
completion, structural integrity, and quality of the project.
Legal practitioners
A legal practitioner must hold a current practising certificate and
have professional indemnity insurance. They can:
Review and advise on the vendor’s statement and the contract of sale
Make sure that the transfer of title is done correctly
Advise on terms and conditions that need to be included in a contract to meet individual needs, and on
the ways in which different types of title may affect ownership rights and responsibilities
Perform general legal work and provide legal advice to their client
If you use a legal practitioner, make sure they have a current practising certificate by checking with the
appropriate body in your State or Territory. For example, in Victoria, you can check the Legal Service Board of
Victoria’s public register of legal practitioners.
Conveyancers
A conveyancer is a person, other than a legal practitioner, who can:
Undertake property conveyancing work
Perform legal work or give legal advice with respect to the transfer of title
A conveyancer must hold a licence and have professional indemnity insurance.
Conveyancers can be engaged to:
Find and review property titles
Check the vendor‘s statement
Advise on the terms and conditions in the contract of sale
If you use a conveyancer, make sure they are licensed by checking with the appropriate body in your State or
Territory. For example, in Victoria, you can check the Victorian Business Licensing Authority‘s public register of
conveyancers.
11.3 PROJECT REPORTING
The success of a project relies on high-quality communication processes. Therefore, it is important to make sure
that various key practices are observed in order to achieve success in constructing a building project. This may
involve a number of challenges relating to monitoring, measuring, and controlling performance.
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Performance involves the art of control which, in turn, involves the process of monitoring. Traditional effective
control involves:
Establishing standards (from which benchmarking will follow)
Monitoring standards via regular inspections
Measuring performance against standards, taking corrective action as necessary
Performance controls may include the use of tools, such as:
Charts (for milestones, budgets, etc.)
Contingency plans
Risk management
Measuring performance involves a criterion - or a range of criteria – agreed upon between the parties. It is
normally represented in the contract documentation. It is not easy to measure performance due to the influence
of a number of factors. For example:
Project lifecycle – different stages of the project produce different outcomes during the project’s
lifespan
The duration of the project – generally speaking, the longer the duration of the project, the greater the
number of individual tasks. The greater the number of tasks, the more difficult it is to accurately and
confidently measure performance across all tasks.
11.4 PRACTICAL COMPLETION
The construction of a project is normally represented by contract documents and specifications. Therefore, part
of the completion of a construction project requires that all the legal requirements, including those relating to
the content and storage of contract documents and specifications, are satisfied. This information should be
included in the contract documentation at the commencement of the project.
For example, the following are some of the documents which need to be completed.
Completion certificates – documents which effectively demonstrate performance, as stipulated in the
contract
Retention of monies – provisions against any defects discovered in the finished works; such retentions
are normally held by the client
Warranties – normally associated with the technical aspects of the project. These can be easily
invalidated due to incorrect operation
Maintenance – normally represented by a separate contract following formal handover of the project
Operational documentation – every project does not necessarily have access to operating manuals and
supporting technical documentation. The law dictates that ignorance of this requirement is no defence
against failing to meet it
Archiving – Preserving records of how the project was undertaken (including the above) is vital to
ensure that those working on similar, future projects can study your procedures and reactions to
problems/crises with the aim of improving their outcomes. The reasons for keeping project records
may include:
o Benefits for the next project
o Skills and knowledge transference
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(Note: text taken from Master Builders Association of Victoria - New Homes Building Contract)
17. OBLIGATIONS OF BOTH PARTIES UPON COMPLETION
17.1 Submission of final claim and notice of completion by builder
On Completion, the Builder will give to the Owner:
the Final Claim; AND
if a building permit was issued for the Works a copy of the Occupancy Permit, if required, or in any
other case a copy of the certificate of final inspection, if required, AND
a written notice: (i) stating that the Works are complete and the date on which the Works reached
Completion; AND (ii) requesting a final inspection of the Works with the Owner or the Owner's
Agent at a date and time specified in the notice.
17.2 Owner will notify builder if unable to attend final inspection
If the Owner or the Owner's Agent is unable to attend the final inspection of the Works at the date and
time specified in the Builder's notice given under clause 17.1, THEN the Owner will:
immediately notify the Builder in writing of the Owner's or the Owner's Agents unavailability to
attend that inspection prior to the date of the Builder's proposed inspection; AND arrange with the
Builder an inspection of the Works at a mutually agreeable time during normal business hours and
on a date which must not be later than seven (7) Days from the Builder's proposed date for final
inspection;
BUT if the Owner does not do so then the Owner will be taken to be available to attend the final
inspection at the date and time stated by the Builder's notice given under clause 17.1.
17.3 If owner fails to attend final inspection final claim due and payable
If the Owner or the Owner's Agent does not attend the arranged final inspection of the Works with the
Builder, then by failing to attend the Owner agrees that:
the Works will be taken to have reached Completion; AND
The Final Claim submitted by the Builder shall be payable in accordance with Item 13 of the
Appendix.
17.4 If owner agrees works are complete final claim becomes due and payable
If at the final inspection of the Works the Owner agrees that no defects exist and the Works have
reached Completion, then the Owner must:
sign a notice to that effect; AND
Pay the Final Claim to the Builder in accordance with Item 13 of the Appendix.
17.5 Owner to provide signed defects list to builder in certain circumstances
If at the final inspection of the Works the Owner claims any defects exist, or the Works are in any way
incomplete or not in accordance with the Plans or Specifications, then the Owner must at that
inspection give to the Builder a written list specifying such items and both the Builder and the Owner
will sign this list and each will retain a copy. Notwithstanding the fact that the Builder signs the list
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provided by the Owner, the Builder's signature is not an admission that the alleged defects or
incomplete items exist in the Works.
17.6 Builder will complete the works within 21 days of receipt of a signed defects list
The Builder will complete any necessary outstanding items listed on the signed defects list as required
by this Contract within twenty-one (21) Days or if any necessary Materials are unavailable, within a
reasonable period after receiving a signed defects list under Clause 17.5.
17.7 Final claim payable by Owner upon completion of items by Builder
Upon completion of all necessary outstanding items stated in the defects list given under Clause 17.5
the Owner will pay the Final Claim to the Builder in accordance with Item 13 of the Appendix.
17.8 Owner's entitlement to keys and possession of the works
The Owner will not take Possession of the Works or any portion of the Works and will not be entitled to
the keys to the Works prior to payment to the Builder of the Final Claim; UNLESS
the Owner has obtained the Builder's written consent to take Possession; OR
Is otherwise entitled to do so under this Contract or at law.
17.9 If Owner takes possession of the Works when not entitled to do so Owner is liable to Builder for
any loss or damage suffered
If the Owner takes Possession of the Works or any portion of the Works when not entitled to do so
under this Contract or at law, the Owner will be liable to the Builder for any loss or damage resulting
therefrom.
17.10 Builder to hand over keys upon payment of all monies under the Contract
On payment by the Owner of the Final Claim, the Builder will provide all keys to the
17.11 Owner's obligation upon taking possession of the works
Upon the Owner taking Possession of the Works, the Owner will maintain the Works in a good, fit and
proper condition for the duration that the Owner remains in Possession of the Works for a period not
exceeding ten (10) years.
17.12 Land to be in a neat and tidy condition before builder submits final claim
The Builder will, before submitting the Final Claim to the Owner, ensure that the Land and the Works
are in a reasonably neat and tidy condition.
A Guide to Standards Australia
If you need more information, head to the FAQ page of Standards Australia at:
http://www.standards.org.au/pages/faq.aspx
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11.5 TERMINATION
When developing a contract for a construction project, it is important that you identify and assess the factors
that might lead to the termination of that contract. You will therefore need to make sure that the roles and
responsibilities of all contract parties are identified, agreed upon, and documented in accordance with
legislative, organisational, and project requirements. This will involve implementing consultative processes to
negotiate and confirm contract specifications with the relevant people.
Although contracts can be cancelled by any party at any time, the party terminating the contract must consider
the costs of doing so. All your construction contracts should include a clause or clauses that clearly state the
grounds and procedures associated with termination of the
contract. If you do not have appropriate termination clauses, then
the contract may be subject to the general contract law
appropriate to your State or Territory. If this is the case, then the
outcomes of any disputes may not be as favourable as you might
expect.
You may wish to terminate a contract with a subcontractor for theft, fraud, poor or slow work, or the death of
the contractor. Whatever the cause, you must follow the contract conditions and written procedures pertaining
to it in the contract. To do this may involve giving the subcontractor a specified period of notice, or you might
be required to request rectification/repair of particular work. In some instances, you might be able to claim extra
costs associated with contracting others to complete the work.
Failure to follow the termination clauses and procedures specified in the contract could lead to a claim by the
subcontractor for loss of profit and other expenses, which will ultimately impact on the profitability of the job.
When communicating with a subcontractor during contract termination, it is vital that every contact is
documented in some way. Keep copies of emails and letters, and make file notes of telephone conversations or
meetings. No matter how insignificant you might think the contact is, recording the details might make a
difference to the outcomes of subsequent legal action.
(Note: text taken from Master Builders Association of Victoria - New Homes Building Contract)
26. RESOLUTION OF DISPUTES
26.1 Unsettled disputes may be referred VCAT
If any dispute between the Owner and the Builder in connection with this Contract cannot be resolved by
informal agreement either party may make application to the Victorian Civil and Administrative Tribunal
("VCAT") which is located at 55 King Street, Melbourne and which may be contacted by telephone on (03)
9628 9999
During the lead up to, and following termination of a contract, you should make sure that the site has been
properly secured. This also applies to any materials and tools on the site. By doing this, you are protecting
the assets of your organisation that might be under threat from the subcontractor who might cause damage
to, or take assets in lieu of payment pending the outcome of legal action. Although you should have suitable
security procedures and processes in place at all times, it is particularly important during contract
termination, as people sometimes act irrationally when under stress caused by legal conflict.
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20. OWNER'S RIGHTS TO TERMINATE CONTRACT
(Note: text taken from Master Builders Association of Victoria - New Homes Building Contract)
20.1 Owner's right to serve notice of intention to terminate contract
If the Builder:
fails to produce to the Owner a copy of the relevant insurance policy or certificate of currency setting
out details of the required insurance under the Building Act 1993, as required by Clause 5; OR
fails to proceed with the Works with due diligence or in a competent manner; OR
unreasonably suspends the carrying out of the Works; OR
refuses or persistently neglects to remove or remedy defective work or improper Materials, so that by
the refusal or persistent neglect the Works are adversely affected; OR
refuses or persistently neglects to comply with this Contract (including the requirements of municipal
or other authorities); OR
is unable or unwilling to complete the Works or abandons the Contract; OR
is in substantial breach of this Contract;
If you are unsure about any aspect of contract termination, always seek advice from the legal department of
your organisation, or from a suitably qualified legal practitioner.
According to Alexandra Wedutenko (of the legal firm Clayton UTZ), it is critical that, when developing contracts,
you:
Make sure that your contract is well-drafted, with a clear scope and timelines for delivery
Include and follow contract variation procedures. If you do exercise variations, make sure you specify
new delivery times, where relevant
Properly manage a contract, dealing with non-performance issues in a prompt manner. If you wish to
terminate, you need to clearly and specifically follow the termination procedures in your contract
Ensure that you act as if ‘time is of the essence’. If time is a critical element in your contract, comply
with all contract provisions, including giving appropriate notice related to termination requirements.
11.6 CALCULATON OF RISE AND FALL PROVISIONS
Given that the duration of the construction phase of a project can often be measured in months and years, and
because the construction of project is basically represented by labour and materials, it stands to reason that the
cost of labour and materials may rise and fall periodically during the life of the project. With regard to fixed price
contracts, the rise and fall may be the responsibility of either the contractor or the client. Precisely whose
responsibility it is should be determined prior to starting work, as bearing sole responsibility for covering rise
and fall costs in a contract can turn out to be heavily expensive.
Rise and fall provisions are used in lump sum type contracts to compensate either the client or the contractor
for fluctuations in the prices of labour and/or materials. The use of such a clause in a contract allows tenderers
to be competitive in their pricing, in that they do not have to be concerned with the effects of inflation.
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Rise and fall provisions can only be used in contracts over $500,000.
The use of AS 2124 General Conditions of Contract allows for rise and fall provisions. Calculation of the applicable
rise and fall is done by way of a formulae is reliant on one or more independently maintained cost indices,
published monthly by the Australia Bureau of Statistics, as the Labour Index and Producer Price Index for
construction industries.
Simple rise and fall example:
o Rise and fall % = [(New index – Base index) / (Base index)] x 100
Example:
Labour Index in February 2009 = 100.18
Labour Index in February 2010= 102.31
Rise and fall from February 2009 to February 2010 = [(102.31 – 100.18) / (100.18)] x 100 = 2.13 %
Example:
Zero Construction takes on a 15 month project, the builder and client have opted to claim for the rise and
fall at each 5 (five) month stage of the project.
The project contract is signed in March 2010, in which the Labour Index is 102.4 and the Producer Price
Index is 96.9.
The contract is signed for a total cost all $624,000, costs are divided equally throughout each stage.
Month Month Labour index Producer Index
base March 2010 102.4 96.9
1 April 2010 102.75 96.9
2 May 2010 103 97.1
3 June 2010 103.3 97.2
4 July 2010 103.6 97.5
5 August 2010 103.9 97.8
Total [Mar-August]
[103.9-102.4/102.4]*100
1.46%
[97.8 – 96.9/96.9]*100
1.00%
For the Stage 1 Payment of $624,000 / 3 = $208,000
Rise and fall rate of Labour at 1.46% will give an increase of $3,036 with the total amounting = $211,036
Rise and fall rate of Producer Price at 1.00% will give an increase of $2,080 with the total amounting to =
$210.080
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6 September 2010 104.2 98.1
7 October 2011 104.5 98.4
8 November 2010 104.9 98.6
9 December 2010 105.3 98.8
10 January 2011 105.5 98.9
Total [Mar ’10 –Jan ‘11]
[105.5-102.4/102.4]*100
3.02%
[98.9 – 96.9/96.9]*100
1.76%
For the Stage 2 Payment of $624,000 / 3 = $208,000
Rise and fall rate of Labour at 3.02% will give an increase of $6,281 with the total amounting to =
$214,281.00
Rise and fall rate of Producer Price at 1.76% will give an increase of $3,696 with the total amounting to =
$211,696.00
11 February 2011 105.9 99
12 March 2011 106.2 99.1
13 April 2011 106.5 99.5
14 May 2011 106.9 99.8
15 June 2011 107.4 100.2
Total [Mar’10-Jun’11]
[107.4-102.4/102.4]*100
5.18%
[100.2 – 96.9/96.9]*100
3.41%
For the Stage 3 Payment of $624,000 / 3 = $208,000
Rise and fall rate of Labour at 5.18% will give an increase of $10,777 with the total amounting to =
$218,777.00
Rise and fall rate of Producer Price at 3.41% will give an increase of $7,092 with the total amounting to =
$215,092.00
11.7 PROGRESS PAYMENTS
The basic advantage of a progress payment scheme is to enable the contractor to receive a portion of total value
of the contract when a particular part of a project is completed. Normally, progress payments for the
construction of a project are processed on a monthly basis, thereby allowing a contractor, for example, to
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receive payments for works completed for, say, the month of April to be paid at the end of May. Such payments
enable the contractor to maintain a positive cash flow with respect to the construction of the project at hand.
AS 2124 General Conditions of Contract contains within it detailed documentation as to the process to follow
for progress payments, including other types of payments that may be made as part of the construction project.
Accordingly, detailed next is Method A from the MBAV New Homes Building Contract. Although each builder
has different processes or methods of claiming completed building works, the following ― Method A - is the
preferred option.
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Method A
NOTE: Method A is prescribed under Section 40 of the Domestic Building Contracts Act 1995 and is generally
used for new homes. If Method A is used, the Builder must not demand, recover, or retain more than the
percentage of the Contract Price stated for the completion of each Stage of the Works. Under Method A or B,
the maximum deposit is 5% if the Contract Price is $20,000 or greater, and 10% if the price is less than
$20,000.
TYPE OF CONTRACT
(Select one of the
following)
%OF
CONTRACT
PRICE
VALUE (in figures) PAYMENTS AND
STAGES UNDER THE
CONTRACT
Contract to build to lock up stage $ Deposit
(refer to Clause 11.6 and Item
10.2 of the Appendix)
( 20% ) $ Base Stage
(25%) $ Frame Stage
$ Final Payment Upon Completion
= 100% $ Total
Contract to build to fixing stage $ Deposit
(refer to Clause 11.6 and Item
10.2 of the Appendix)
( 12% ) $ Base Stage
( 18% ) $ Frame Stage
( 40% ) $ Lock up Stage
$ Final Payment Upon Completion
= 100% $ Total
Contract to build through to all
stages
$ Deposit
(refer to Clause 11.6 and Item
10.2 of the Appendix)
(10% ) $ Base Stage
(15% ) $ Frame Stage
(35% ) $ Lock up Stage
(25% ) $ Fixing Stage
$ Final Payment Upon Completion
=100% $ Total
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A typical New Homes Contract includes the following provision:
Either the Owner or the Builder may ask for the Building Works to be varied. The request must be in writing,
must be signed, and must set out the reason for and details of the variation sought.
If the Owner requests the variation and the Builder reasonably believes the variation will not require a
variation to any permit, will not cause any delay, and will not add more than 2% to the Contract Price, the
Builder may carry out the variation.
If the Builder requests the variation, the notice given by the Builder must state the following further
particulars:
1. What effect the variation will have on the Building Works
2. If the variation will result in any delays, the Builder's estimate of such delays, and
3. The cost of the variation and the effect it will have on the amount payable by the Owner under this
contract.
If the Owner requests a variation and the Builder has not agreed to carry out the variation, the Builder must
give the Owner, within a reasonable time after having received the request, a notice setting out the
particulars. Alternatively, the Builder must state that they refuse (or are unable) to carry out the variation,
detailing the relevant reasons. Therefore, the Builder must not give effect to any variation unless the Owner
gives the Builder signed consent to or a request for the variation attached.
If, within 7 days of the Builder giving the Owner the particulars, the Owner does not give the Builder
(i) A signed variation and
(ii) Written evidence of the Owner's ability to pay for the variation, the request by the Owner for the
variation is deemed withdrawn.
11.8 EXTENSIONS OF TIME
Normally, within the building and construction industry, extensions of time for delay are concerned with the
practical completion date; more specifically, those activities which are critical – those in which delays causes
practical completion to be delayed at the same time.
Remember that activities on the critical path of a construction
program are those which afford no spare time (or ‘float’),
meaning that the activity must start and be completed on the
allocated dates.
On the other hand, it is normal within a building construction
contract to allow for a stipulated number of days to cover for
when poor weather (e.g. rain) does not allow construction to
proceed. However, should poor weather be excessive to that
stipulated in the contract, then there may be good reason for
the contractor to seek an extension of time.
AS 2124 General Conditions of Contract clearly stipulates the circumstances upon which extensions of time can
be granted.
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(Note: text taken from Master Builders Association of Victoria - New Homes Building Contract)
15. DELAYS AND EXTENSION OF TIME CLAIMS
15.1 Builder's entitlement to extensions of time
If the progress of the Works is delayed by
any variations under this Contract; OR
proceedings being taken or threatened by or disputes with adjoining neighbouring owners or residents;
OR
any industrial action or civil commotion affecting the Works or any of the trades employed upon the
Works or affecting the manufacture or supply of Materials for the Works; OR
the general unavailability of any Materials necessary to carry out the Works; OR
inclement weather or any condition as a result of inclement weather in excess of the reasonable
allowance stated in A and B of Item 9.2 of the Appendix; OR
any act, default or omission on the part of the Owner, or breach of the Contract by the Owner,
including failure by the Owner to provide to the Builder any information requested by the Builder under
Clause 9.2 relating to Prime Cost Items and Provisional Sums; OR
any obstruction, interference or hindrance with the carrying out of the Works by the Owner, the
Owner's Agent or any person engaged by the Owner to perform other work on the Land; OR
any delay in the Owner obtaining or continuing to obtain the Land Owner's Consent (if required) under
Clause 7.1 for the Builder to carry out the Works on the Land; OR
any delay or refusal of any authority to grant or issue any necessary permit; OR
any other cause beyond the reasonable control of the Builder including any act or omission by any
person engaged by the Owner relating to the Works;
THEN
in any such case, the Builder will within a reasonable time advise the Owner of the cause and the reasonable
estimated length of the delay and the Builder will be entitled to a fair and reasonable extension of time for
Completion of the Works;
AND/OR
The Builder may, within fourteen days (14) Days of becoming aware that Completion of the Works will be
delayed, notify the Owner in writing of the delay stating the cause and the reasonable estimated length of
the delay.
11.9 FINALISE THE CONTRACT
The final contract must be prepared in consultation with relevant people in accordance with the policies and
procedures of your organisation, and all necessary legal requirements. All required contract information must
be sourced in consultation with relevant people and assessed for currency, accuracy, and relevance, in
accordance with organisational and project requirements. According to the Tasmanian Government Purchasing
Department (2010), at the contract finalisation stage, you have the opportunity to:
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Test the understandings and assumptions made by tenderers in determining their costs
Clarify and rectify any false assumptions
Achieve operational refinements and enhancements that may result in cost reductions
Any gaps or deficiencies can then be identified, and appropriate actions implemented.
(Note: text taken from Master Builders Association of Victoria - New Homes Building Contract)
19. DEFECTS LIABILITY PERIOD
19.1 Defects liability period may be provided by the builder
If the Builder provides to the Owner a Defects Liability Period as stated in Item 14 of the Appendix, then that
period will commence upon Completion of the Works or upon the Owner taking Possession of the Works,
whichever is earlier.
19.2 Owner may provide defects list prior to expiry of defects liability period
After Completion and prior to the expiration of the Defects Liability Period, the Owner may provide to the
Builder a written list of any alleged defects arising out of Builder's defective workmanship or Materials
supplied by the Builder under this Contract.
19.3 Builder will rectify defects on expiry of defects liability period
Subject to reasonable access to the Land being provided by the Owner, the Builder will within twenty-eight
(28) Days of the expiry of the Defects Liability Period, make good and rectify any necessary defects as
required by this Contract, notified to the Builder under Clause 19.2, during usual business hours and at no
cost to the Owner. The Builder will not, however, have the responsibility to rectify any alleged defective
items which arise from the fact that something is still to be supplied or done by the Owner or relating to any
maintenance of an item which is to be performed by the Owner or is the responsibility of the Owner.
19.4 If owner denies builder opportunity to rectify builder's liability reduced
If the Owner without reasonable cause does not allow the Builder the opportunity to return to the Land to
make good and rectify any defects or does not provide reasonable access to the Builder to allow the Builder
to do so, the Builder will only be liable to the Owner for the cost which the Builder would have incurred had
the Builder been permitted to rectify the defect.
19.5 If builder fails to rectify owner may engage others and recover cost from builder
Subject to Clause 19.4, if the Builder fails to make good and rectify any defects within twenty-eight (28)
Days of expiry of the Defects Liability Period without reasonable excuse, the Owner may then engage or
employ others to make good such defects or faults to the extent that the Builder has failed to do so and
recover from the Builder the reasonable cost of doing so.
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11.10 CLOSE AND STORE THE JOB FILE
Once the contract has been completed, all associated documents, working drawings, and specifications must be
collated and assembled in readiness for formal consideration. All associated correspondence for submission to
contract parties must also be prepared, in accordance with organisational requirements. When completed, all
documents can be forwarded for signing, in accordance with legislative and
contractual requirements.
You should ensure a copy of the contract documentation is retained for future
reference and maintained securely with due regard to confidentiality, in
accordance with legislative, organisational, and project requirements.
At the end of the defects liability period of the contract, when all omissions have
been completed and defects rectified, the contractor is entitled to receive the
balance of the contract sum. This sum will have been adjusted for any variations
that have arisen during the period of the contract. The issue of a final certificate
constitutes an acceptance that all work required under the contract has been
satisfactorily completed. The initiation of further new work under the original
contract during the defects liability period is to be avoided. The balance of any
remaining contract securities should be released to the contractor.
11.11 PRACTICAL COMPLETION INSPECTION
Final inspections of new homes are also commonly referred to as Practical Completion Inspections (PCI) and pre
handover inspections.
Final inspections are generally carried out on new homes when construction of the entire home has been
completed and all internal fittings, fixtures and finishes have been installed and applied inside the home
compliant with the relevant building plans and specifications. Practical Completion
Inspections (PCI) are completed by independent building consultant or inspector
before the final payment is handed over to the builder.
The independent building consultant or inspector inspects the works and provide a
report containing the following:
A clear description of each defect – what each defect is and where each
defect is located.
An explanation as to why specific building works or finishes are defective –
with the relevant sections of the Building Code of Australia (BCA) and
Australian Standards and Tolerances t
A concise recommendation – A plain English recommendation stating clearly
what the Builder has to do to rectify each defect.
Practical Completion Inspections (PCI) can include an inspection the following:
Roofing materials (e.g. Concrete and terracotta roof tiles, Colorbond steel sheets, slate etc.) have been
correctly installed and fixed in position.
The pointing of all ridge and hip roof tiles is consistent in terms of colour and texture and there are no
cracks in the pointing.
All fascia boards and bargeboards are correctly aligned and fully fixed in position.
All gutters and downpipes and correctly installed and adequately fixed in position.
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There is adequate fall applied to the gutters around the house and the garage.
Water does not pond in the gutters.
There is no damage to specially coated surfaces
All brickwork to ensure that it is level, plumb, straight, square and that all articulation joints, flashings
and weepholes have been correctly placed and installed.
That the colour of the bricks and mortar have not changed due
to excessive cleaning with acid and washing with water under
very high pressure.
That the high pressure cleaning process has not blown out
sections of the mortar from between the bricks.
That all surplus mortar and stains have been fully removed from
the face of the brickwork.
The mortar has the required strength (i.e. the mortar is not too
soft, crumbling or sandy).
All articulation joints in external brick walls have been fully
sealed to prevent the ingress of moisture and rainwater in to
the house.
All brickwork is properly placed on the concrete slab and that it does not overhang the slab.
There are no cracked, chipped or broken bricks.
There is adequate clearance between windows and abutting brick sills.
All different types of external wall cladding and lining (e.g. Hebel panels, cement sheet panels and
timber weatherboards etc.) have been correctly fitted and fixed in position.
The gaps between all window and door frames and the abutting brickwork is not excessive.
There is no damage to window frames, door frames, door handles or locks and the glass fitted to doors
and windows has not been scratched, chipped or cracked.
There are adequate draught and weather seals fitted around all external facing doors and windows.
There are no obvious entry points for birds that can nest in roof spaces above warm and hot downlights
and start fires.
Ceilings have been correctly installed and that joints in the plasterboard are not highlighted and very
obvious after they have been painted.
All sections of cornice have been installed level and straight.
All sections of the internal walls are plumb, straight and square.
Skirting boards have been installed level and straight.
All joins in architraves and skirting boards are cut straight and finished flush.
All relevant surfaces have been adequately prepared (i.e. filled and sanded smooth) and all tool marks
and ridges on the surface of plasterboard throughout the house have been removed prior to painting.
The paint finish applied to all relevant surfaces is consistent in terms of both colour and texture.
The clearances around all doors and drawers are adequate.
The operation of all door handles, door locks and window locks.
There is no sticking or jamming of doors or windows.
All cupboards, vanity units and bench tops are correctly installed.
The interface between all basins, baths, kitchen sinks and laundry troughs and bench tops are fully and
properly sealed.
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Tiling is properly installed.
Proper installation of baths and shower bases.
Correct installation of carpets.
Water pressure from all taps and shower roses.
All plumbing to make sure that it does not leak.
All power points are connected and correctly wired.
The drainage flow rates out of shower bases, baths, basins, laundry troughs, kitchen sinks and toilet
pans.
The operation of all appliances if they are installed at the time of the inspection.
There is no damage to plasterboard (i.e. ceilings, cornice and walls), tiles, architraves, skirting boards,
window frames, door frames, doors, drawers, cupboards, vanity units, bench tops, basins, baths,
kitchen sinks, laundry troughs, tap fittings, water spouts, wall mirrors, window winders and locks, door
locks, carpets and other floor surfaces (e.g. polished concrete) and appliances.
Summary
In this section, you have learnt how to prepare a contract by:
Seeking expert advice as required
Defining, analysing, and assessing factors leading to the termination of a contract
Accurately calculating contract rise and fall amounts
Assessing and including schedule of progress payments
Including the processes for applying for extensions of time, and
Preparing final contract in consultation with relevant personnel, in accordance with the accepted
process of the organisation and legal requirements.
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Learning Activity 11.1 – Understanding Contractual Terms
This Activity may be completed in pairs.
1. With reference to a domestic building site, discuss the effects of the following contractual terms with
respect to works carried out by subcontractors who report to a Domestic Builder (contractor):
a. progress payments
b. extensions of time
c. breach of contract
d. termination of contract
e. rise and fall provisions
You may use this space to take any notes:
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Learning Activity 11.2 – Finalising the Contract
This Activity may be completed in pairs.
1. With reference to a domestic building project, outline the process that could be used to finalise the
contract.
You may use this space to take any notes:
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SECTION 12: INDUSTRIAL RELATIONS, POLICIES AND OBLIGATIONS
Industrial relations is the term used to cover working conditions such as rates of pay, annual leave, sick leave
and long service leave, amongst other things. There are two industrial relations systems in Australia – the
national and the state systems. Both systems have different sets of laws and different minimum entitlements. It
is important that you find out if your employment is covered by the state or the national system.
12.1 EMPLOYER OBLIGATIONS
Your obligations to employees and other workers come from a variety of sources - federal, state and territory
laws, industrial awards and agreements, tribunal decisions and contracts of employment (whether they are
written or verbal). Some of your obligations as an employer include:
Paying correct wages
Reimbursing your employees for work-related expenses
Ensuring a safe working environment
Not acting in a way that may seriously damage an employee's reputation or cause mental distress or
humiliation
Not acting in a way that damages the trust and confidence necessary for an employment relationship;
Not providing a false or misleading reference
Forwarding PAYG tax instalments to the Australian Taxation Office (ATO)
Making appropriate payment under the superannuation guarantee legislation
Making available reference material on access to industrial relations or legal information to employees
12.2 NATIONAL EMPLOYMENT STANDARDS (NES)
From 1 July 2009, most Australian workplaces are governed by a new system created by the Fair Work Act 2009.
The Fair Work Ombudsman helps employees, employers, contractors and the community to understand and
comply with the new system.
As of 1 January 2010, the National Employment Standards (NES)
replace the Australian Fair Pay and Conditions Standards.
Together with modern awards, the NES make up a new safety net
for employees covered by the national workplace relations
system. In addition to the NES, an employee terms and conditions
of employment generally come from an award or agreement.
What Are The 10 NES Entitlements?
The NES are set out in the Fair Work Act 2009 and comprise 10
minimum standards of employment which involve the following minimum entitlements.
1. Maximum weekly hours of work. 38 hours per week, plus reasonable additional hours.
The Act outlined the following considerations as to what constitutes ‘reasonable additional hours:’
Any risk to the worker’s health and safety that might reasonably be expected to arise if the worker
worked the additional hours
The worker’s personal circumstances (including family responsibilities)
The operational requirements of the workplace, or enterprise, in relation to which the worker is
required or requested to work the additional hours
Any notice given to the worker of the requirement or request that the worker work the additional hours
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Any notice given by the worker of the worker’s intention to refuse to work the additional hours;
Whether any of the additional hours are on a public holiday.
2. Request for flexible working arrangements. An entitlement allowing parents or carers of a child under school
age, or of a child under 18 with a disability, to request a change in working arrangements to assist with the care
of the child.
3. Parental leave and related entitlements. Up to 12 months unpaid leave per employee, plus a right to request
an additional 12 months unpaid leave, plus other forms of maternity, paternity and adoption related leave.
4. Annual leave. Four weeks paid leave per year for each 12 months of service, plus an additional week for
certain shift workers.
5. Personal/carers leave and compassionate leave. 10 days paid personal/carers leave, two days unpaid carer’s
leave as required, and two days compassionate leave (unpaid for casuals) as required.
6. Community service leave. Unpaid leave for voluntary emergency activities and leave for jury service with an
entitlement to be paid up to 10 days for jury service.
7. Long service leave. A transitional entitlement for employees as outlined in an applicable pre-modernised
award, pending the development of a uniform national long service leave standard.
8. Public holiday. A paid day off on a declared public holiday, except when reasonably requested to work.
9. Notice of termination and redundancy pay. Up to five weeks’ notice of termination and up to 16 week’s
severance pay on redundancy, both based on length of service.
10. Provision of a Fair Work Information Statement. Must be provided by employers to all new employees, and
contains information about the NES, modern awards, agreement-making, the right to freedom of association,
termination of employment, individual flexibility arrangements, union rights of entry, transfer of business, and
the respective roles of Fair Work Australia and the Fair Work Ombudsman.
Who do the NES apply to?
The NES apply to all employees covered by the National Workplace Relations System (however only certain
entitlements apply to casual employees). There are two NES entitlements that apply to all full time and part time
employees, whether they are covered by the national workplace relations system or not.
These are:
1. Parental leave and related entitlements (this also applies to casual employees who have been employed
for at least 12 months by an employer on a regular and systematic basis and with an expectation of
ongoing employment)
2. Notice of termination
However, only certain NES entitlements apply to casual employees and these are:
Two days unpaid carers leave and two days compassionate leave per occasion;
Maximum weekly hours
Community service leave (except paid jury service)
Provision of the fair work information statement
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In addition, casual employees who have been employed for at least 12 months by an employer on a regular and
systematic basis and with an expectation of ongoing employment are entitled to:
Make requests for flexible working arrangements
Parental leave
12.3 ENTERPRISE BARGAINING
Enterprise bargaining is the process of negotiating wage and working conditions at the level of the individual
organisations. Once established, an Enterprise Bargaining Agreement (EBA) is legally binding on employers and
employees. An EBA consists of a collective industrial agreement between an employer and trade union acting
on behalf of employees, or between an employer and employees acting for themselves.
On the one hand collective agreements, at least in principle,
benefit employers, as they allow for improved "flexibility" in such
areas as ordinary hours, flat rates of hourly pay, and
performance-related conditions. On the other, hand collective
agreements benefit workers, as they usually provide higher pay,
bonuses, additional leave and enhanced entitlements (such as
redundancy pay) than an award does.
Unlike awards, which provide similar standards for all workers in
the entire industry covered by a specific award, collective
agreements usually apply only to workers for one employer -
although on occasion a short-term collaborative agreement (for
example, on a building-site) yields a multi-employer/employee
agreement.
Parties endorse proposed enterprise bargaining agreements between themselves (in the case of employers the
matter goes to a vote). Fair Work Australia then assess them for approval. (Under the Fair Work Act 2009,
agreements now [update] renamed "enterprise agreements" and are lodged with Fair Work Australia to assess
entitlements against the modern award and be checked for breaches of the Act.).
12.4 UNION RIGHT OF ENTRY
The amendments to the federal workplace relations legislation changed the former law about union officials’
access to employers’ building sites and other premises. Union officials need a federal permit to gain access to a
workplace, even on occupational health and safety grounds (OHS)
where that right of entry exists under the following prescribed
law. There is now much greater employer control over union right
of entry to premises.
Unfair Dismissal – What Is It?
Put simply, an unfair dismissal occurs when an employee has been dismissed – that is, fired – and the dismissal
is ‘harsh, unjust or unreasonable.’
Harsh Unjust or Unreasonable
The factors which will indicate whether a dismissal is ‘harsh, unjust or unreasonable’ include (but are not limited
to):
Whether there was a valid reason for the dismissal
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Whether the employee was advised of this reason
Whether the employee was given a chance to respond to the reason
Whether the employee was given warning that their performance was unsatisfactory?
Who Is Eligible To Make A Claim?
An employee may lodge a claim if he or she:
Has completed the ‘minimum employment period’
Earns less than $108,300 per year
The ‘minimum employment period’ varies depending on whether the employee was employed by a small
business i.e. less than 15 employees. If they were, the period is set at 12 months of continuous service. In all
other cases, the minimum employment period is 6 months continuous service.
The Claim Process
An employee who feels they have been unfairly dismissed may lodge an application with Fair Work Australia
within 14 days of the dismissal taking effect. Fair Work Australia generally conducts proceedings within 6 weeks
of the application where both parties may be represented.
Possible Outcomes
If the dismissal is found to be unfair, Fair Work Australia may order reinstatement of the employee and/or
payment of compensation. When deciding how much compensation to award, Fair Work Australia will look at a
number of factors relevant to the applicant’s employment. The maximum amount that the dismissed employee
can receive in compensation is capped at 26 weeks’ pay.
12.5 BUILDING AND CONSTRUCTION AWARDS
Each industry in Australia has determined the minimum conditions and wages payable to its workers. These
agreements are called Employment Awards. An important aspect of these Awards is that they cover the
minimum rate of pay that can be made to an employee. These Awards must be at least equal to any State
minimum wage, and at least equal to the Federal minimum wage.
Wages in Australia are mainly paid either fortnightly or monthly. Wages are paid after deduction of tax and the
Medicare Levy. The employer normally also has to pay an extra 9%, on top of the employee’s basic salary, into
a superannuation fund on behalf of the employee. In some cases the
Superannuation Fund is specified in the Award or Agreement under which
the employee is employed. In other cases the employee may choose
between the employer’s ‘default’ fund and a fund of their choice.
Employers can pay more than the 9% if they wish, but not less. Casual
employees are normally paid at a higher rate than permanent employees
to compensate for the loss of certain entitlements such as paid holiday
leave. This extra rate is set down in the State Award Rates.
Minimum Wage in Australia
The Australian Fair Pay Commission is an independent body responsible for adjusting federal minimum wages.
The National Minimum Wage Order 2014 set the (national) minimum wage at $16.97 per hour. Read more at
their website www.fwa.gov.au.
Redundancy
An employee is entitled to redundancy pay if you terminate their employment because:
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You no longer require the job that was done by the employee to be done by anyone (except where this
is due to the ordinary and customary turnover of labour); or
You, or your business, become insolvent or bankrupt
The entitlement to redundancy pay is contained in the National Employment Standards (the NES). For further
information on who is entitled to redundancy pay, what the entitlement is and how it applies to small businesses,
visit Payment of Redundancy. If your employees have not been offered suitable alternative employment (further
information below), they must be notified in writing and the notice must contain details of the entitlements they
are to be paid (such as annual leave, redundancy and long service leave) and a ‘statement of service’ or letter
specifying:
The amount of time the employee worked for your business
The hours that they worked
The requirement to notify your employees that a contract they are working on is due to expire, or has been
terminated 28 days before it ends is not notice of termination. If your employees are being made redundant as
a result of the contract ending, you must also provide them with the correct amount of notice of termination
and this will be based on the amount of time that they have been working for your business. If you don’t, you
may need to pay them instead of giving them notice.
An employee is not entitled to redundancy pay if you can find suitable alternative employment for them. They
are also not entitled to redundancy pay if they are employed by the incoming contractor. If your employee is
employed by the incoming contractor, then you must pay them all of their accrued entitlements, such as wages
and annual leave - but they are not entitled to redundancy pay.
12.6 INDEPENDENT CONTRACTORS
An independent contractor is someone who is self-employed and contracts their services to clients, such as other
businesses. They are often referred to as sub-contractors or ‘subbies’. An example of an independent contractor
could be a plumber who is hired by a business to fix a burst
pipe. The plumber attends the business with his own tools and
employees, fixes the pipe, and bills the business for the cost of
the job. Although an independent contractor may perform
work for a business, they are not regarded as an employee and
will generally have different rights to employees.
Telling the difference between an independent contractor and
an employee is not always a straightforward process. Some
employers misrepresent or disguise employment relationships
as independent contracting arrangements to avoid paying legal
minimum rates of pay, tax, and entitlements such as annual
leave and sick leave. Arrangements such as these are not genuine and may be regarded as sham contracting.
Most independent contractors run their own business, control their own working times and decide how and
where they undertake work.
It is important that you know whether you are an independent contractor or an employee so you can be sure
that you are receiving the correct entitlements. Here is a checklist that will assist in determining whether or not
someone is a bona fide independent contractor:
Make certain the contractor trades as either an individual, a partnership, has a registered business
name, or a Pty Ltd Company
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Ensure the contractor advertises their business
Ensure the contractor invoices for completed work
The independent contractor ensures that no part of the financial consideration of the contract has been
withheld for holiday pay, sick leave, long service leave, superannuation
The contractor reserves the right to employ or subcontract any aspect of the work
The contractor has discretion and flexibility regarding work performance including start and finish times
The contractor accepts responsibility for any defective or remedial work
The contractor provides an ABN number and, if required, has GST registration
The contractor provides his/her tools, plant & equipment
The contractor provides his own public liability & income protection insurance
The contractor is a member of a relevant industry association
State by state
Victoria
The Building and Construction Industry Security of Payment Act 2002 provides a process for subcontractors
to be remunerated for work that has been completed. The Act improves payment practices in the Victorian
Building and Construction Industry. The Act helps to ensure that any person who carries out construction
work or supplies related goods and services under a construction contract gets paid. The Act is designed to
increase cash flow and provide a fast, cheap, non-legalistic way of resolving payment for work done or
materials or services supplied.
The Act covers both verbal and written construction agreements;
It provides a statutory right to be paid for work done;
It establishes default payment terms where contract is silent;
It bans "pay when paid" and "paid if paid'' clauses;
It establishes a process for the fast recovery of payments;
It provides for the quick adjudication of payment disputes at a low cost to the parties.
New South Wales
The Building and Construction Industry Security of Payment Act 1999 provides a process for subcontractors
to be remunerated for work that has been completed. This is administered by NSW Fair Trading. They also
offer helpful advice on matters including:
Entitlement to progress payments
Disputes
Summary of key deadlines
Payment following a payment claim
Giving a payment schedule
Adjudication process
Payment withholding request
Making a complaint
For more information go to the NSW Fair Trading website (http://www.fairtrading.nsw.gov.au).
Queensland
There are now protections in place to avoid sub-contractors not getting paid. Building and Construction
Industry Payments Act 2004 provides a process for subcontractors to be remunerated for work that has
been completed. This is administered by the Queensland Building and Construction Commission. For more
information go to the QBCC website (http://www.qbcc.qld.gov.au).
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12.7 MODERN AWARDS
Most businesses are covered by a modern award. Modern awards commenced on 1 January 2010 and are
industry or occupation-based employment standards that operate in conjunction with the Fair Work Act 2009.
They were created to establish one set of minimum conditions for employers and employees across Australia
who work in the same industries and occupations. The award does not need to list individual businesses.
There is also a Miscellaneous Award 2010
which covers employees who are not
covered by another modern award and
who perform work of a similar nature to
that which has historically been regulated
by awards. It is likely that new and
innovative jobs which are developed over
time will not fall neatly into existing
industry awards, so it is possible that the
Miscellaneous Award will cover some of
those employees. To find out which
award covers your employees visit the
Fair Work Online website or call the Fair Work Info line on 13 13 94.
What is an Enterprise Agreement and what must it contain?
The Fair Work Act 2009 commenced on 1 July 2009. New agreements under the Act are now called Enterprise
Agreements and are simply an agreement between one or more national system employers and their
employees. Fair Work Australia (FWA) will use the Better Off Overall Test (BOOT) to assess new enterprise
agreements. The major new features of enterprise agreements are that they must have:
A nominal expiry date of not more than four years after the day on which FWA approves the agreement
A dispute settlement procedure
A flexibility term so the employee and employer can agree to vary the agreement to meet mutual needs
if required
A consultation term, which requires the employer to consult with their employees about any major
workplace changes that are likely to have a significant effect on them
If an enterprise agreement does not contain a flexibility or consultation term, the generic model clause
prescribed by the Fair Work Regulations will be 'deemed' to be included in that agreement, and therefore must
be followed. If a business was bound by a collective/workplace agreement prior to 1 July 2009, that agreement
continues to operate until it is terminated or replaced.
For information on enterprise agreements and how to make and lodge them, visit the Fair Work Online website
www.fairwork.gov.au and look for the section 'What do I need to know about agreements?’
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New South Wales and Queensland
New South Wales
NSW Industrial Relations (NSW IR) works with employers and employees to achieve fair, equitable and
productive workplaces. NSW IR supports the NSW Government as a participant in the national workplace
relations system, by monitoring and advising on workplace relations developments and initiatives.
NSW IR ensures compliance with the new NSW Guidelines for infrastructure procurement, as well as
administering state laws regulating shop trading hours, public holidays and long service leave.
NSW IR conducts compliance activities across the State in order to educate the community about New
South Wales industrial relations laws as well as educating employers and employees on the Fair Work
system. These compliance activities are proving to be an effective and efficient way to assist large numbers
of NSW employers and employees to understand their employment rights and obligations.
Employers and employees have certain obligations or duties to each other under common law, statutes and
their accompanying regulations. NSW Industrial Relations, part of the NSW Treasury, administers legislation
regulating employment matters details of this legislation can be found on the NSW Industrial Relations
website (http://www.industrialrelations.nsw.gov.au).
Queensland
The Queensland Industrial Relations Commission is an independent tribunal which derives its powers and
functions from Chapter 8, Part 2 of the Industrial Relations Act 1999. It also has powers and functions under
the following legislation:
Workers' Compensation and Rehabilitation Act 2003
Further Education and Training Act 2014
Trading (Allowable Hours) Act 1990
Public Service Act 2008
Contract Cleaning Industry (Portable Long Service Leave) Act 2005
Public Interest Disclosure Act 2010
Work Health and Safety Act 2011
Child Employment Act 2006
Magistrates Courts Act 1921
Local Government Act 1993
The Commission can help resolve disputes involving employers, employees and unions, and employer
associations who are covered by the national workplace relations system. The Fair Work Commission has
the power to carry out a range of functions relating to:
minimum wages
awards and agreements
industrial action
dispute resolution
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12.8 WORKPLACE DISCRIMINATION
Commonwealth and State and Territory governments all have laws to help protect people from harassment and
discrimination. The following legislation operate at a federal level and the Australian Human Rights Commission
has statutory rights under them:
Age Discrimination Act 2004
Australian Human Rights Commission Act 1986
Disability Discrimination Act 1992
Racial Discrimination Act 1975
Sex Discrimination Act 1984
Types of Discrimination
It is against the law to discriminate against someone because of their actual or assumed:
Age
Carer status, family responsibilities, parental status
Disability / impairment (including physical, sensory and intellectual disability, work related injury,
medical conditions, mental, psychological and learning disabilities)
Employment activity
Gender identity, lawful sexual activity, sexual orientation
Industrial activity
Marital status
Physical features
Political belief or activity
Pregnancy, breastfeeding
Race (including colour, nationality, ethnicity and ethnic origin)
Religious belief or activity
Sex
Personal association with someone who has, or is assumed to have, one of these personal
characteristics
Workplace Discrimination by State
Victoria
The Victorian Equal Opportunity and Human Rights Commission is an independent statutory body with
responsibilities under three laws:
Equal Opportunity Act 1995
Racial and Religious Tolerance Act 2001
Charter of Human Rights and Responsibilities
The Equal Opportunity Act 1995 makes it illegal to discriminate against people on the basis of a number of
different personal characteristics. The Racial and Religious Tolerance Act 2001 makes it illegal to vilify people
because of their race or religion. Under the Equal Opportunity Act 1995 and the Racial and Religious
Tolerance Act 2001, the Commission helps people resolve complaints of discrimination, sexual harassment
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and racial or religious vilification through a free and impartial complaint resolution service with the aim of
achieving a mutual agreement.
The Charter of Human Rights and Responsibilities (the Charter) requires that government and public bodies
must consider human rights when making laws and providing services. The Commission's role is to educate
people about the rights and responsibilities contained in the Charter and to report annually to the
government about the operation of the Charter. The Commission does not handle complaints related to the
Charter.
Equal Opportunity
As an employer, you have a legal responsibility to ensure your workplace is safe and free from
discrimination, bullying and sexual harassment. Most complaints received by the Victorian Equal
Opportunity & Human Rights Commission are employment related and many could have been avoided if
appropriate procedures were in place. There are also benefits to having a workplace free from
discrimination and sexual harassment. Workers are more likely to have better morale and be more
productive if they feel safe and supported. Staff turnover and recruitment costs are reduced, as are staff
complaints, disruptions and legal disputes.
New South Wales
The New South Wales Anti-Discrimination Act 1977 is an Act of the NSW Parliament, relating to
discrimination in employment, the public education system, delivery of goods and services, and other
services such as banking, health care, property and night clubs. It is administered by the Anti-Discrimination
Board of NSW. The Act prohibits unlawful racial, sexual and other types of discrimination in certain
circumstances and promotes equality of opportunity for all people. The Act covers the following types of
discrimination:
Sex (including breastfeeding, pregnancy and sexual harassment)
Disability (including past, present or future Disability and also includes actual or perceived HIV
status)
Race (including ethno-religion)
Sexuality (actual or perceived)
Marital or domestic status
Age (present or future)
Transgender (including trans sexuality)
Religion
Carer’s responsibilities (but only within employment)
Queensland
The Queensland Anti-Discrimination Act 1991 is an Act of the QLD Parliament which is administered by the
Anti-Discrimination Commission QLD. The Commission's services include:
resolving complaints received under the Act;
delivering training to business, government and the community; and
promoting public discussion on human rights
The Act prohibits unlawful racial, sexual and other types of discrimination in certain circumstances and
promotes equality of opportunity for all people. The Act covers the following types of discrimination:
age discrimination
gender issues
impairment discrimination
pregnancy and breastfeeding
racial and religious discrimination
sex discrimination
sexual harassment
sexuality discrimination
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Anti- discrimination policy
Under many state laws, and some federal laws, certain employers are required to establish and maintain anti-
discrimination and/or anti-harassment policies to protect their employees. Even if not specifically required by
law, it is a good idea for any employer to have these policies in place. Not only do they enable an employer to
make it clear to their employees that certain types of behaviour are intolerable, they may also provide a defence
for an employer should a lawsuit arise.
However, if a written policy is in place, the employer must make sure that they follow it! If you are an employer,
and you don't have these policies in the place, the following are sample policies that you might want to reference
in drafting your own policy.
Warning: These sample policies might not fully comply with particular state requirements, so make sure that
you check your own state's laws or have an attorney review your policy before you hand it out to employees.
Sample Anti-Discrimination Policy
An anti-discrimination policy could contain the following language:
”The employer is an equal opportunity employer. The employer will not discriminate and
will take ‘affirmative action’ measures to ensure against discrimination in employment,
recruitment, and advertisements for employment, compensation, termination, upgrading,
promotions, and other conditions of employment against any employee or job applicant on
the bases of race, creed, colour, national origin, or sex.”
Note: Not all employers are required to comply with affirmative action requirements, so that language may be
deleted in those situations. In addition, the last sentence can be tailored to conform to the law in your particular
state. For example, if you must also comply with laws prohibiting discrimination on the basis of sexual
orientation, you may include that language as well.
Sample Anti-Harassment Policy
A sample anti-harassment policy may state:
“The employer is committed in all areas to providing a work environment that is free from
harassment. Harassment based upon an individual's sex, race, ethnicity, national origin, age,
religion or any other legally protected characteristics will not be tolerated. All employees
including supervisors and other management personnel are expected and required to abide
by this policy. No person will be adversely affected in employment with the employer as a
result of bringing complaints of unlawful harassment.”
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12.9 TRAINING AGREEMENTS (BY STATE)
Victoria
Apprentices or trainees sign a written contract called either a 'contract of training' in some states, or a
'training agreement' in others. The contract/agreement requires the employer to guarantee to train the
apprentice or trainee in the agreed occupation or training area, and to allow time off work if necessary to
attend any off-the-job training. In return, the apprentice or trainee agrees to learn all aspects of the
occupation or area of training and to work for the employer for a specified period.
Terms of the Training Agreement
A probation period exists for both apprenticeships and traineeships and may vary in length. This period
enables the apprentice or trainee and the employer to assess whether each will be satisfied in the coming
years of employment. During this time, either party may terminate the contract/agreement by giving the
appropriate amount of notice in accordance with the award or employment agreement.
As the terms of the contract/agreement depend on varying circumstances, information about them can be
obtained from the State Training Authority. An apprentice or trainee remains an employer’s responsibility
throughout the term of the contract. However, if any party wishes to end the relationship, he or she should
first contact the State Training Authority so the correct procedures may be followed.
Cancellation of the Training Contract
A cancellation of the training contract can be made at the request of either the employer or employee prior
to the end date of the contract.
If the Australian Apprenticeship is still within the stipulated probation period, the contract can be legally
cancelled by either party giving one week's notice. After the probation period, you may request to cancel
the contract if:
Your business ceases operations
There is a substantial change to your business circumstances and you are no longer able to fulfil
your obligations
Your Australian Apprentice is guilty of misconduct.
Offences by your Australian Apprentice which constitute misconduct include:
Being absent from work without consent
Not attending or participating in training required by the training plan
Causing serious damage or risk to your business, reputation or staff
Theft, assault and fraud
Being under the influence of drugs or alcohol at work.
The Australian Apprentice can request to have the training contract cancelled if:
You have relocated your business to a place that is unreasonable for the Australian Apprentice to
travel to
There is a substantial change in their circumstances affecting their capacity to work, for example
an allergy or physical condition.
If you are able to reach a mutual and voluntary agreement to cancel the contract you must both complete
and sign the required cancellation form. Contact your local Australian Apprenticeships Centre for assistance
and forward the form to the relevant STA. If you can't reach a mutual agreement to cancel the training
contract, your state or territory Industrial Relations agency has its own procedures. The relevant committee
or tribunal will investigate the situation, and either dismisses the complaint or attempts to resolve it.
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New South Wales
Training agreements are administered by the NSW Office of Education under the NSW Apprenticeship and
Traineeship Act 2001. Apprentices or trainees are employed under an industrial arrangement or approved
workplace agreement. The agreement requires the employer to guarantee to train the apprentice or
trainee in the agreed occupation or training area, and to allow time off work if necessary to attend any off-
the-job training. In return, the apprentice or trainee agrees to learn all aspects of the occupation or area of
training and to work for the employer for a specified period.
Terms of the Training Agreement
The nominal term of an apprenticeship or traineeship is specified in the training contract but as all
apprenticeships and traineeships are competency based, the actual completion date may be earlier or later
than the expected completion date.
The nominal term of an apprenticeship is generally four years. This includes from two to three years of
formal training delivered by a registered training organization, usually either one day per week or in blocks
of several days during the year. The final year is usually spent full-time on the job. Traineeships generally
range from six months to three years. In some industries part time traineeships with proportionally longer
training terms are available.
All apprenticeships and traineeships (with the exception of trainee apprenticeships) have a probationary
period which varies from 1 to 3 months depending on the term of the training contract. The date on which
the probationary period ends is specified in the approval letters sent to the employer and
apprentice/trainee. The probationary period can be extended by up to three months on application by the
employer and apprentice/trainee.
While the apprentice/trainee is ‘on probation’, the employer or apprentice/trainee can withdraw from the
training contract simply by giving the appropriate period of notice to the other party. The employer must
notify State Training Services within 14 days of withdrawal.
1
Information on apprenticeships, traineeships and training agreements can be found on the NSW Office of
Education website (http://www.training.nsw.gov.au/businesses/apprenticeships_traineeships).
Queensland
Training Agreements
Training agreements are administered by the Department of Education, Training and Employment under
the Further Education and Training Act 2014 and the Regulations to the Act. The training contract sign-up
and registration is facilitated by Australian Apprenticeships Centres (AACs).
Apprentices or trainees are employed under an industrial arrangement or approved workplace agreement.
The agreement requires the employer to guarantee to train the apprentice or trainee in the agreed
occupation or training area, and to allow time off work if necessary to attend any off-the-job training. In
return, the apprentice or trainee agrees to learn all aspects of the occupation or area of training and to
work for the employer for a specified period.
Information on apprenticeships, traineeships and training agreements can be found here:
http://apprenticeshipsinfo.qld.gov.au/information-resources
1 http://www.training.nsw.gov.au/businesses/apprenticeships_traineeships/getting_started/employment_conditions.html
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Workplace access to legal and industrial relations
Access to industrial relations information is limited at times for small businesses. Large businesses generally
have specific departments dealing with Industrial Relations, Human Resources, Administration and Marketing
and usually provide employees with the current information they require. Small building companies generally
don’t have the resources to provide employees with professional services, and will at times look to industry
associations and bodies to support them. These associations can support companies in establishing their own
policies, depending on the scope of work, and can provide current wage entitlements and relevant awards.
12.10 COMPLAINTS AND DISPUTES
A good business tries to minimise customer complaints through excellent customer service, and to address
customer complaints about the business or a product or service quickly and fairly. Customer complaints should
be dealt with in a consistent manner through the use of a company policy document on the agreed upon method
to resolve complaints.
Dealing with Customer Complaints
There are Australian Standards for complaint handling and customer service which may be useful guides. In
developing an effective customer complaint policy, consider the following suggestions:
Examine how effectively your business currently handles complaints
Involve your staff in developing a complaint handling system,
and decide who will handle complaints
Anticipate common complaints and work out standard
solutions
Write down your complaints handling procedure and
prepare a standard complaint form
Ensure all staff are trained in the procedure and have the
skills to resolve complaints
Display a sign saying your business welcomes genuine
complaints about product quality or service
Clearly advise your customers where and how they can
report problems
Ensure your customers can report problems to you at any
time
Keep a record of all problems and complaints and maintain these records
Trial the system, and use customer and staff feedback to improve it over time
Resolving Complaints
When a customer has a genuine complaint, thank them for raising the matter with you. Treat them with genuine
empathy, courtesy, patience, honesty and fairness. Try to respond to the complaint quickly. Tell the customer
how you will handle it and when to expect a response. Speak to the customer in person. Do not rely on written
complaints or records of conversations. To show that you clearly understand their complaint:
Familiarise yourself with any background information before you speak to them, check internal records,
speak to staff and check how their version of events compares with the customer's
Listen carefully and do not jump to conclusions, lay blame or become defensive
Ask questions to clarify the situation
Summarise back to the customer your understanding of the problem
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Following Through
Once you take the complaint details, tell the customer what will happen next. If possible, nominate one staff
member to manage the complaint until it is resolved. Ensure that this staff member has the authority to organise
solutions that the customer will accept. Adopt a solution-focused approach by actively involving the customer
in this process. Ensure you take all promised action as promptly as possible. When you find a solution, tell the
customer and check they are happy with the resolution. Tell them how you will prevent the problem arising
again.
See Section 13: BUSINESS DISPUTES for more information on dispute resolution.
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Learning Activity 12.1 – Working with Subcontractors
This Activity may be completed in pairs.
1. You are interviewing Danny who is a third year Carpenters Apprentice. Danny asks you the following
questions:
a. What is my rate of pay?
b. What is the maximum hours I can work each week?
c. Where can I check to get this information?
2. How would you answer?
You may use this space to take any notes:
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Learning Activity 12.2 – Collecting Subcontractor Information
This Activity may be completed in pairs.
1. Johnny owns a small construction company and has picked up his next project to build 24 townhouses
in Altona North. He will need to hire sub-contractors to help with majority of the work.
2. Research and record what information Johnny will need to collect to ensure the subcontractors are
hired and maintained as subcontractors during this project.
You may use this space to take any notes:
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SUMMARY
As you have completed this Learner Guide, including the accompanying activities, you have addressed the key
topic outcomes including:
Apply the laws relating to the builder licensing or registration
Apply OHS/WHS legislation and provisions on site
Apply the codes, Arts, regulations and standards relevant to construction
Comply with insurance and regulatory requirements for housing construction
Apply legislation to financial transactions
Meet building contract obligations
Apply industrial relations policies and obligations relevant to housing constructions
If you have any further queries or learning needs for this topic, please discuss these with your trainer or
workplace supervisor.
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APPENDIX A: ACRONYMS
TERM DEFINITION
HSC Health and Safety Committee
BPB Building Practitioners Board
DB-U Domestic Builder Unlimited
DB-M Domestic Builder Manager
DB-L Domestic Builder-Limited
ATO Australian Taxation Office
ASIC Australian Securities and Investment Commission
Pty. Ltd. Proprietary Limited
ABN Australian Business Number
VBA Victorian Building Authority
RTO Registered Training Organisation
BCA Building Code of Australia
ABCB Australian Building Codes Board
EPA The Environmental Protection Authority
PAYG Pay as you go
HELP Higher Education Loan Programme
GST Goods and Services Tax
WST Wholesale Sales Tax
BAS Business Activity Statement
DBCA
Domestic Building Contracts Act 2005
NES
National Employment Standards
OHS
Occupational health and safety
WHS
Workplace health and safety
ASIC Australian Securities and Investment Commission
Pty. Ltd. Proprietary Limited
QBCC Queensland Building and Construction Commission
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APPENDIX B: ACTS, LEGISLATION AND REGULATORS
WHS/OHS Acts and legislation
Relevant Act and Regulations
Regulator and Workers Compensation Authorities
The Commonwealth of Australia
Work Health and Safety Act 2011
Work Health and Safety Regulations 2011
Comcare
Website: www.comcare.gov.au
Phone: 1300 366 979
New South Wales
Work Health and Safety Act 2011
Work Health and Safety Regulations 2011
WorkCover NSW
Website: www.workcover.nsw.gov.au
Email: [email protected]
Phone: 13 10 50
Queensland
Work Health and Safety Act 2011
Work Health and Safety Regulations 2011
WorkCover Queensland
Website: www.worksafe.qld.gov.au
Phone: 1300 369 915
Victoria
Occupational Health and Safety Act 2004
Occupational Health and Safety Regulations 2007
WorkSafe Victoria
Website: www.worksafe.vic.gov.au
Phone: 1800 136 089
ACTS, standards, legislation and regulators: Further information
The Commonwealth of Australia
Body, legislation, Act or standard Further information
The Australian Business License and Information Service
(ABLIS)
https://ablis.business.gov.au
Australian Securities and Investment Commission (ASIC). www.asic.gov.au
Corporations Act http://www.austlii.edu.au/au/legis/cth/consol_a
ct/ca2001172/
Australian Building Codes Board (ABCB) and the Building
Code of Australia (the BCA)
www.abcb.gov.au
National Construction Code (NCC) https://services.abcb.gov.au/NCCOnline/
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Australian Standards www.standards.org.au
Green Building Council of Australia- Green Star rating https://www.gbca.org.au
Australian Consumer Law 2011 (ACL) www.consumerlaw.gov.au
Copyright Act of 1968 http://www.comlaw.gov.au/Series/C2004A07378
Australian Taxation Office (ATO) https://www.ato.gov.au
NATIONAL EMPLOYMENT STANDARDS (NES) www.fairwork.gov.au/employee.../national-
employment-standards
Fair Work Act 2009 http://www.austlii.edu.au/au/legis/cth/num_act
/fwa2009114/
Fair Work Australia (FWA) and The Australian Fair Pay
Commission
https://www.fwc.gov.au/
Age Discrimination Act 2004
Australian Human Rights Commission Act 1986
Disability Discrimination Act 1992
Racial Discrimination Act 1975
Sex Discrimination Act 1984
https://www.humanrights.gov.au/our-
work/legal/legislation
Australian Apprenticeships Centres (AACs) www.australianapprenticeships.gov.au
New South Wales
Body, legislation, Act or standard Further information
NSW Fair Trading www.fairtrading.nsw.gov.au/
Home Building Amendment Act 2014 http://www.legislation.nsw.gov.au/maintop/vie
w/inforce/act+24+2014+cd+0+N
Queensland Building and Construction Commission Act
1991 (QBCC Act)
https://www.legislation.qld.gov.au/.../Q/QldBuil
dConCommA91.pdf
Home Building Act 1989 http://www5.austlii.edu.au/au/legis/nsw/consol
_act/hba1989128/
Code of Practice for Construction Work http://bit.ly/1BTz0Tu
The Code of Practice for Procurement
https://www.procurepoint.nsw.gov.au/policies/n
sw-government-procurement-information
The Implementation Guidelines to the New South Wales
Code of Practice for Procurement: Building and
Construction (the Guidelines)
Environmental Planning and Assessment Act 1979 (or
“the EP&A Act”)
http://hub.planning.nsw.gov.au/PlanningControl
s/Legislation.aspx
Environmental Planning and Assessment Regulation
2000 (or “the EP&A Regulation”)
State Environmental Planning Policies (SEPPs) http://hub.planning.nsw.gov.au/PlanningControl
s/StateEnvironmentalPlanningPolicies.aspx
Local Environmental Plans (LEPs) http://www.planning.nsw.gov.au/standard-
instrument
The Protection of the Environment Operations Act 1997
(POEO Act)
http://www.epa.nsw.gov.au/legislation/aboutpo
eo.htm
Building Sustainability Index (BASIX) https://www.basix.nsw.gov.au/basixcms/
NSW Fair Trading (Consumer Affairs) http://www.fairtrading.nsw.gov.au/
Building and Construction Industry Security of Payment
Act 1999 (the Act)
http://www.constructionlawmadeeasy.com/Secu
rityofPaymentNSW#S.PlegislationNSW
NSW Industrial Relations (NSW IR) http://www.industrialrelations.nsw.gov.au/
the Anti-Discrimination Board of NSW http://www.antidiscrimination.justice.nsw.gov.a
u/
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NSW Apprenticeship and Traineeship Act 2001 http://www.legislation.nsw.gov.au/maintop/vie
w/inforce/act+80+2001+cd+0+N
NSW Office of Education
http://www.training.nsw.gov.au/index.html
Queensland
The Queensland Building and Construction Commission
(QBCC)
https://www.qbcc.qld.gov.au/
Building and Construction Industry Payments Act 2004 https://www.legislation.qld.gov.au/legisltn/curre
nt/b/buildngcipa04.pdf
Subcontractors Charges Act 19741 https://www.masterbuilders.asn.au/laws-codes-
and-regulations/subcontractors-charges-act
Building and Construction Industry Payments Regulation
2004
https://www.legislation.qld.gov.au/LEGISLTN/.../
B/BuildngCIPR04.pdf
Domestic Building Contracts Act 2000
https://www.legislation.qld.gov.au/legisltn/curre
nt/d/domebldconta00.pdf
Domestic Building Contracts Regulation 2010 https://www.legislation.qld.gov.au/legisltn/curre
nt/d/domebldcontr10.pdf
Queensland Building and Construction Commission Act
1991
https://www.legislation.qld.gov.au/.../Q/QldBuil
dConCommA91.pdf
Queensland Building and Construction Commission
Regulation 2003
https://www.legislation.qld.gov.au/legisltn/.../q/
qldbuildconcommr03.pdf
QLD Fair Trading Act 1989 https://www.legislation.qld.gov.au/LEGISLTN/.../
F/FairTradA89.pdf
Building and Construction Industry Payments Act 2004 https://www.legislation.qld.gov.au/legisltn/curre
nt/b/buildngcipa04.pdf
Queensland Development Code http://bit.ly/1Hh98ac
Domestic Building Contracts Act 2000 https://www.legislation.qld.gov.au/legisltn/curre
nt/d/domebldconta00.pdf
Subcontractors’ Charges Act 1974 https://www.legislation.qld.gov.au/LEGISLTN/.../
S/SubcontCharA74.pdf
The Sustainable Planning Act 2009 https://www.legislation.qld.gov.au/legisltn/curre
nt/s/sustplana09.pdf
The Environmental Protection Act 1994 (EP Act) https://www.legislation.qld.gov.au/legisltn/curre
nt/e/envprota94.pdf
Cleaner Green Buildings https://www.gbca.org.au/advocacy/states-and-
territories/queensland/6-regulation4/
Queensland Office of Fair Trading http://www.fairtrading.qld.gov.au/?a=221739
Queensland Anti-Discrimination Act 1991 and Anti-
Discrimination Commission QLD
http://www.adcq.qld.gov.au/
Building and Construction Industry Payments Act 2004 https://www.legislation.qld.gov.au/legisltn/curre
nt/b/buildngcipa04.pdf
The Queensland Industrial Relations Commission www.qirc.qld.gov.au/
Department of Education, Training and Employment http://apprenticeshipsinfo.qld.gov.au/index.html
The Further Education and Training Act 2014 http://www.training.qld.gov.au/apprentices/abo
ut/apprenticeship-system-reform.html
Victoria
Victorian Building Authority (VBA) and The Building
Practitioners Board (BPB)
www.vba.vic.gov.au
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Building Act 1993 http://www.austlii.edu.au/au/legis/vic/consol_ac
t/ba199391/
Building Regulations 2006 http://www5.austlii.edu.au/au/legis/vic/consol_r
eg/br2006200/
VIC Fair Trading Act 1999 www.legislation.vic.gov.au/Domino/Web_Notes/
...nsf/.../99-016a.pdf
Planning and Environmental Act 1987 http://www.austlii.edu.au/au/legis/vic/consol_ac
t/paea1987254/
The Planning and Environment (Fees) Regulations 2000 www.legislation.vic.gov.au/domino/web_notes/..
./00-72sr004.pd
The Planning and Environment Regulations 2005 www.legislation.vic.gov.au/Domino/Web_Notes/
...nsf/.../05-033sr.pdf
Environment Protection Act 1970 www.austlii.edu.au/au/legis/vic/consol_act/epa1
970284/
Environmental Protection Authority (EPA) www.epa.vic.gov.au/
The 6 Star Standard http://www.vba.vic.gov.au/consumer-
resources/other/standard-pages/6-star-standard
Consumer Affairs Victoria www.consumer.vic.gov.au/
Domestic Building Contracts Act 2005 (DBCA) www.legislation.vic.gov.au/domino/Web_notes/.
../95-91a061.pdf
Master Builders Association Building Contract New
Homes
http://www.mbav.com.au/vpLink.aspx?ID=401&
BACK=400&PROD=116
The Building and Construction Industry Security of
Payment Act
http://www.vba.vic.gov.au/practitioners/legislati
on
Equal Opportunity Act 1995
Racial and Religious Tolerance Act 2001
Charter of Human Rights and Responsibilities
http://www.humanrightscommission.vic.gov.au/i
ndex.php/the-law/equal-opportunity-
act/timeline-of-victoria-s-equal-opportunity-law
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APPENDIX C: REFERENCES AND RESOURCES
Victorian Building Authority. 2014. Building Practitioners Board. [ONLINE] Available at:
http://www.vba.vic.gov.au/building-practitioners-board. [Accessed 19 February 15].
Victorian Building Authority. 2015. Building registrations. [ONLINE] Available at:
http://www.vba.vic.gov.au/practitioners/building-registrations#architecture-content. [Accessed
19 February 15].
Victorian Building Authority. 2014.
Building Insurance Requirements
. [ONLINE] Available at:
http://www.vba.vic.gov.au/practitioners/building-registrations/insurance-requirements.
[Accessed 20 February 15].
WorkSafe Victoria. 2015. About the industry. [ONLINE] Available at:
http://www.worksafe.vic.gov.au/safety-and-prevention/your-industry/construction/about-the-
industry. [Accessed 20 February 15].
WorkSafe Victoria. 2015. Occupational Health and Safety. [ONLINE] Available at:
http://www.worksafe.vic.gov.au/laws-and-regulations/occupational-health-and-safety.
[Accessed 20 February 15].
WorkSafe Victoria. 2015. Licence to Perform High Risk Work. [ONLINE] Available at:
http://www.worksafe.vic.gov.au/safety-and-prevention/licensing/worksafe-licence-types-and-
fees/licence-to-perform-high-risk-work. [Accessed 23 February 15].
White Card Info. 2014.
Complete your White Card in Melbourne.
[ONLINE] Available at:
http://www.whitecardinfo.com.au/white-card-melbourne/. [Accessed 23 February 15].
Standards Australia. 2015.
Benefits of Standards
. [ONLINE] Available at:
http://www.standards.org.au/StandardsDevelopment/What_is_a_Standard/Pages/Benefits-of-
Standards.aspx. [Accessed 23 February 15].
State Government Victoria. 2014.
Planning Legislation.
[ONLINE] Available at:
http://www.dtpli.vic.gov.au/planning/about-planning/legislation-and-regulations/planning-
legislation. [Accessed 23 February 15].
Port Phillip Council. 2014. City of Port Phillip. [ONLINE] Available at:
http://www.portphillip.vic.gov.au/print_rescode.htm. [Accessed 23 February 15].
State Government Victoria. 2014.
Environment Protection Act.
[ONLINE] Available at:
http://www.epa.vic.gov.au/about-us/legislation/acts-administered-by-epa. [Accessed 23
February 15].
Building Commission. 2013. Building Commission; Annual Report 2012-2013. [ONLINE] Available
at: http://www.vba.vic.gov.au/. [Accessed 24 February 15].
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Consumer Affairs Victoria. 2015. Building and Renovating. [ONLINE] Available at:
http://www.consumer.vic.gov.au/housing-and-accommodation/building-and-renovating.
[Accessed 23 February 15].
NSW Fair Trading [ONLINE] Available at:
http://www.fairtrading.nsw.gov.au/ftw/Tradespeople/Home_building_licensing.page?
[Accessed 21 May 2015].
Minter Ellsion: Building Industry Regulation [ONLINE] Available at:
http://www.constructionlawmadeeasy.com/Chapter14NSW [Accessed 21 May 2015].
Australian Business Licence and Information Service (ABLIS) [ONLINE] Available at:
https://ablis.business.gov.au/pages/home.aspx [Accessed 21 May 2015].
Australian Bureau of Statistics Work-Related Injuries, Australia, JUL 2013 TO JUN 2014. [ONLINE]
Available at:http://www.abs.gov.au/ausstats/[email protected]/mf/6324.0 [Accessed 21 May 2015].
Workcover NSW [ONLINE] Available at: www.workcover.nsw.gov.au [Accessed 21 May 2015].
Australian Building Codes Board National Construction Code & Bulding Code of Australia
[ONLINE] Available at: http://www.abcb.gov.au/ [Accessed 22 May 2015].
Safework Australia. Code of Practice for Construction Work. [ONLINE] Available at:
http://www.safeworkaustralia.gov.au/sites/swa/about/publications/pages/construction-work
[Accessed 22 May 2015].
NSW Government Industrial Relations NSW Building and Construction Industry Code of Practice
for procurement: Building and Construction. [ONLINE] Available at:
http://www.industrialrelations.nsw.gov.au/oirwww/About_NSW_IR/New_Guidelines_Constructi
on_Work.page [Accessed 28 May 2015].
NSW Planning and Environment. Planning legislation. [ONLINE] Available at:
http://hub.planning.nsw.gov.au/PlanningControls/Legislation.aspx [Accessed 22 May 2015].
Green Building Council State Environmental Planning Policy. [ONLINE] Available at:
https://www.gbca.org.au/advocacy/states-and-territories/new-south-wales/5-regulation2/
[Accessed 22 May 2015].
NSW Planning and Environment. Building sustainability Index. [ONLINE] Available at:
http://www.basix.nsw.gov.au/basixcms/ [Accessed 22 May 2015].
NSW Industrial Relations. [ONLINE] Available at:
http://www.industrialrelations.nsw.gov.au/oirwww/About_NSW_IR/Legislation.page [Accessed
28 May 2015].
Australian Human Rights Commission. Anti discrimination laws. [ONLINE] Available at:
https://www.humanrights.gov.au/guide-australias-anti-discrimination-laws [Accessed 28 May
2015].
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NSW Office of Education Training Agreements. [ONLINE] Available at:
http://www.training.nsw.gov.au/businesses/apprenticeships_traineeships/getting_started/empl
oyment_conditions.html [Accessed 28 May 2015].
Australian Business Licence and Information Service (ABLIS) [ONLINE] Available at:
https://ablis.business.gov.au/pages/home.aspx [Accessed 21 May 2015].
Australian Bureau of Statistics Work-Related Injuries, Australia, JUL 2013 TO JUN 2014. [ONLINE]
Available at: http://www.abs.gov.au/ausstats/[email protected]/mf/6324.0 [Accessed 21 May 2015].
Australian Building Codes Board National Construction Code & Bulding Code of Australia
[ONLINE] Available at: http://www.abcb.gov.au/ [Accessed 22 May 2015].
Safework Australia. Code of Practice for Construction Work. [ONLINE] Available at:
http://www.safeworkaustralia.gov.au/sites/swa/about/publications/pages/construction-work
[Accessed 22 May 2015].
Australian Human Rights Commission. Anti discrimination laws. [ONLINE] Available at:
https://www.humanrights.gov.au/guide-australias-anti-discrimination-laws [Accessed 28 May
2015].
Master Builder Association laws, codes and regulations [ONLINE] Available at:
https://www.masterbuilders.asn.au/laws-codes-and-regulations [Accessed 28 May 2015].
Queensland Building and Construction Commission Building legislation [ONLINE] Available at:
http://www.qbcc.qld.gov.au/about-us/legislation [Accessed 28 May 2015].
Queensland Building and Construction Commission Builders Registration [ONLINE] Available at:
http://www.qbcc.qld.gov.au/about-us/legislation [Accessed 28 May 2015].
Queensland Development Code [ONLINE] Available at:
http://www.hpw.qld.gov.au/construction/BuildingPlumbing/Building/BuildingLawsCodes/Queen
slandDevelopmentCode/Pages/QueenslandDevelopmentCodeBackground.aspx [Accessed 29
May 2015].
Queensland Building and Construction Commission Home Warranty Insurance [ONLINE]
Available at: http://www.qbcc.qld.gov.au/contractor-insurance-requirements/about-home-
warranty-insurance [Accessed 01 June 2015].
Queensland Government Department of Housing and Public Works – Queensland Development
Code [ONLINE] Available at:
http://www.hpw.qld.gov.au/construction/BuildingPlumbing/Building/BuildingLawsCodes/Queen
slandDevelopmentCode/Pages/QueenslandDevelopmentCodeBackground.aspx [Accessed 01
June 2015].
Green Building Council of Australia Cleaner Greener Buildings [ONLINE] Available at:
https://www.gbca.org.au/advocacy/states-and-territories/queensland/6-regulation4/ [Accessed
01 June 2015].
Green Building Council of Australia Green Star [ONLINE] Available at:
https://www.gbca.org.au/green-star/ [Accessed 01 June 2015].
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Queensland Government Training Agreements [ONLINE] Available at:
http://apprenticeshipsinfo.qld.gov.au/information-resources/info-sheets/is27.html [Accessed 01
June 2015].